[sachinpk]

Originally Posted by AltoLXI

IT, ITeS companies jittery over Rs 10,000 crore tax demand.

So was it that the IT companies did not pay any taxes in the pre-GST era? Or was it a case there were even export taxes; but IT/ITES was given an exemption from that taxes (through SEZ etc. etc.).

One thing is for sure. GST is going to stay (irrespective of who would be forming the Central Govt.).

[vrprabhu]

Originally Posted by samaspire

... run a business and I'm very ignorant on GST. So, a few queries ....

Originally Posted by Samurai

You really need to sit down with your CA and discuss this. Are you not GST registered yet? Why are you asking these questions in November?

Samurai - your posts indicate how much you have learnt within a short span of four months! May be there is scope to develop some solution for GST ignorant businesses?

BTW, both of you being in the same geographical area, there is a chance you paths must have crossed?

samaspire, I am also surprised how you have managed to run your business without GST registration.

Let me attempt to answer your questions -

1. GST has to be paid for the month in which the invoice is raised. The payment of GST will coincide with the filing of GSTR1 return, which has to be done on the following month. For example, for an invoice raised on 10th October 2017, you have to pay the GST by 20.11.2017 (last date for filing GSTR3B return, a stop gap arrangement as GSTR1 filing is facing hiccups). Payment of GST has to be made IRRESPECTIVE of whether you have actually received the payment or not.

2. Looks like you have some idea of GST deadlines. Doesn't matter whether the bill is dated 1st or 31st of a month. GST has to be paid by 20th of next month, whether the payment is received or not.

3. You definitely have an idea what GST is all about. You can issue a single invoice and show the applicable SAC codes for the two activities separately. But, be sure that you have obtained GST invoices for the printing work which YOU got done, else you will not be eligible for input tax credit (ITC) for the GST which YOU paid to the printer (is he GST registered? if not, you may be required to pay GST through Reverse Charge Mechanism (RCM), which too is now put on hold till 31.03.2018).

4. Right now ITC is based on GSTR3B filed by you and it is provisional credit (meaning, can be reversed if your supplier doesn't upload the invoice and pay GST). Actual ITC will be based on the invoices uploaded by your supplier (to whom you have paid GST) through his GSTR1 and accepted by you through your GSTR2A.

5. You can claim ITC only in respect of those expenses incurred for running your business. All such expenses must be backed by GST invoices, with your GSTIN mentioned on it. GST on furniture purchased for your house can be claimed, if you are running your business from your house, and you are using the furniture for business purposes. You can even try to claim depreciation benefit under Income Tax, in that case

(PS - Above answers are subject to approval from our friendly Mod named above )

[samaspire]

Originally Posted by vrprabhu

BTW, both of you being in the same geographical area, there is a chance you paths must have crossed?

Yes. We do know each other. I put the query here so that others might benefit from the answers.

I am also surprised how you have managed to run your business without GST registration.

Actually, I'm still running my business without GST registration. There is slab of 20 lakhs for registration, right? So, I divide my income between myself, my father and my wife. One firm was registered under GST because it was a requirement for inter state billing.


In continuance of your answers:

1. What's the logic behind this? Why are we supposed to pay taxes on money we haven't earned yet?

5. Yes. The business is registered on my home address in my wife's name.

[vrprabhu]

You chose to be an 'unregistered' vendor, based on turnover criteria. Mind you, the limit is for the turnover (=sales) and not income.

1. I can only guess that Government wanted to pre-empt unscrupulous merchants from pocketing the GST and not depositing in Govt account; hence, the rule of paying GST in the same month as that when the invoice was raised.

But, if you follow the logic of GST returns (as per original plan), the sales (outward supplies) return - GSTR 1 - to be filed by 10th of next month; the purchase (inward supplies) return - GSTR 2 - to be filed by 15th, so that the final matched return - GSTR 3 - which gives the monthly position of the actual GST payment due, is ready by 20th.

If they don't stick to a pre-defined method of filing invoice wise returns, there would be chaos (not that things are hunky-dory now).

2. Well, you definitely need the services of CA, as you would be required proper records in case the taxman calls you over for assessment. However, to claim ITC, you need to ensure that the GSTIN of the business which is registered in your wife's name (with your home address) is provided in each and every 'purchase' invoice.

[mallumowgli]

Originally Posted by vrprabhu

Let me attempt to answer your questions -

Prabhuji, if you can answer my question - Any idea how I can send a demo equipment to my client on returnable basis? It will be an inter-state transaction. The equipment will be sent to my client's premises in Chennai from Kerala and will be returned after about a month. No sale or service involved

[vrprabhu]

Originally Posted by mallumowgli

It will be an inter-state transaction.

The equipment will be sent to my client's premises in Chennai from Kerala and will be returned after about a month.

No sale or service involved

Million dollar question

I am sure that you would not have found a conclusive answer so far!!

It will require a discourse - not an answer!

My reply is based on my understanding of GST treatment for free samples, though, strictly speaking, your case may not be exactly the same, as the item is to be returned.

But since this is a supposed to be a GOOD and SIMPLE tax, let us view it like a layman.

GST is applicable when there is a 'supply' of goods and / or services.

In this case neither there is a sale nor there is a supply (you have to ensure that the person to whom the item is being sent isn't paying you a penny)

So, voila' - GST should not be applicable.

The rider for such transactions under GST is that, the item must be returned within six months. This is MANDATORY.

You can send the item using a 'Delivery Challan' specifying all the details and also that the item has to be returned by a specific date. (Your party at the receiving end may have to use the same DC to return it back). (E-way bill which was supposed to address these kind of issues is on hold...)

Now coming to the gray areas -

a. This is an inter-state movement - the tax authorities in TN can demand that you take a GST registration there, because the item which belongs to you (based in Kerala) is being used for 'business' in TN. If you already have a registration in TN, fine. Otherwise, you have to find out how to overcome this, in case such a requirement from TN tax authorities arises.

b. Since you are going to issue a DC (as opposed to a tax invoice), stating that the equipment is being sent on returnable basis, how sure is the transporter (who will be physically transporting this equipment) that he won't be hassled? Check posts are gone, but flying squads are now undertaking the checking. (PS - It is most likely that the transporter has a better understanding of GST on such items than us )

[mallumowgli]

Originally Posted by vrprabhu

Million dollar question

I am sure that you would not have found a conclusive answer so far!!

Spot on with your assessment And thanks a million for the discourse

The rider for such transactions under GST is that, the item must be returned within six months. This is MANDATORY.

Returning will happen within 3 months at the most. But under GST filing, this condition is not mentioned anywhere. Under excise rules, the 6 months rule was specifically spelt out (and am not clear about how to close the open DC)

(PS - It is most likely that the transporter has a better understanding of GST on such items than us

You are right. I think I should check with the transporter than my auditor

Thanks again

[vrprabhu]

You are welcome!

Six months is mentioned in the GST Rules, I think, within which period the sale must be confirmed (the provision which I am talking about relates to the goods sent on approval basis).

Further, there is also another provision that for transactions to be eligible for availing ITC of GST paid, the dates must not be greater than 180 days (meaning, that the payment of invoices dated prior to six months from the date of actual payment will not entail the purchaser for ITC!)

In fact, I am now stationed not far from where you are!

I presume that you are supplying some thing from Palghat to Coimbatore, right?

Your issue was actually one of the items tried to be raised during the GST meet arranged by the tax authorities....

[mallumowgli]

Originally Posted by vrprabhu

You are welcome!

Six months is mentioned in the GST Rules, I think, within which period the sale must be confirmed (the provision which I am talking about relates to the goods sent on approval basis).

Further, there is also another provision that for transactions to be eligible for availing ITC of GST paid, the dates must not be greater than 180 days (meaning, that the payment of invoices dated prior to six months from the date of actual payment will not entail the purchaser for ITC!)

In fact, I am now stationed not far from where you are!

I presume that you are supplying some thing from Palghat to Coimbatore, right?

Your issue was actually one of the items tried to be raised during the GST meet arranged by the tax authorities....

Ok that clarifies.

Actually am moving items from Palakkad to Chennai. In fact, I've received these items from my principals in Karnataka on returnable basis. And am moving a few of them to an agent in Chennai, who will arrange demo at customer's premises and return them back to Palakkad

PS : You have moved to Calicut? I remember you mentioning about it long back in your travelogue

[vrprabhu]

Originally Posted by mallumowgli

In fact, I've received these items from my principals in Karnataka on returnable basis. And am moving a few of them to an agent in Chennai ..

Uh oh, that could be a thorn in your side. Hope that you have booked the items received from Karnataka as a purchase in your books? (Sale on returnable basis is provided for under GST)

Otherwise, it is likely that you end up playing an agent's role for the original item (and the question of 'any value addition' would arise). I feel that it would be better to treat the equipment as your own and send it to TN for demo on your account, so that complications can be avoided.

One thing which I am sure about is that even officials of (GST) department don't have a clear idea of the taxability part of various business transacations - how many of them can actually give a solution to address issues like the one you have raised is questionable. (Can GST FAQs and tweets be considered as the gospel truth? I doubt it. And, the provision in the law is that all disputes, notices etc. are to handled electronically!)

One point which may work in your (tax payer's) favour is that FM has repeatedly stated that the department won't harass the businesses in the initial phase.

Hope they understand that a normal businessman may commit mistakes due to ignorance, rather than as a means to cheat Govt. out of its revenue.

PS - Your memory is good. Nope, not settled at Calicut. Have landed in Karur (accessible from Calicut as well as Bangalore, which is a different story altogether). Gave up writing travelogues also, as found that some of the favourite (desolate) spots were turning into crowded jamboorees, all because of the vast information now available on the net and every other SUV / crossover owner feels that it is his duty to demonstrate his driving prowess

[AltoLXI]

Where there is a will there is a way - to beat the system.

With the packaged food industry taking a hit because of the GST burden, businesses from across India applied for deregistration in a bid to escape the tax. Popular trademarks went off the shelf overnight and manufacturers began selling products under new, unregistered trademarks.

https://timesofindia.indiatimes.com/...w/62015328.cms

[vrprabhu]

Rajasthan notifies the e-way bill requirements under GST.

Appears to be effective immediately...

[Prowler]

Just when you thought that FB, Instagram and Whatsup sites were down, I am surprised to see that even our own Government GST site was down with this message. What is going on ?

[alpha1]

I am able to view the page.
You are talking about the https://www.gst.gov.in/ ?

[Prowler]

Originally Posted by alpha1

I am able to view the page.
You are talking about the https://www.gst.gov.in/ ?

Yes and even the regular login page https://services.gst.gov.in/ shows the same message.
I have checked with Firefox Enterprise Edition as well as Google Chrome. In Chrome before it allows you to login it displays the same error message at the top of the usual page. If the site was hacked, our login credentials would be compromised. So I aborted immediately.