- GST Registration
GST Registration is mandatory if the business turnover in an FY exceeds Rs.40 lakh (in case of the supply of goods) and Rs.20 lakhs (in case of the supply of services).
Also, a business entity can opt for voluntary registration of GST. However, once opted the GST should be compulsorily charged unless exempted.
- Rate of Tax for Goods or Services (HSN Code or SAC Code)
Once the entity is GST registered, the next step is to identify the rate of tax which needs to be charged on the goods or services which are to be supplied. You can do this by visiting the GST website.
The tax rate on goods is mentioned along with its HSN Code, where HSN (Harmonious System of Nomenclature) is a code given to that particular good or class of goods.
- Charging GST on every invoice –CGST,SGST,IGST
Once GST is registered, the GST should be charged on the invoice issued along with the GST Number. The GST number has to be mandatorily mentioned by every taxable person providing the taxable services.
In case of supply within the state (aka Intra-state supplies) the supplier has to charge CGST & SGST/UTGST, and in case of supplies outside the states (Interstate Supplies) on the respective invoice.
- Providing GSTN number for every purchase to claim ITC
To claim the Input tax credit for the purchase made or for the services paid, the entity has to mandatorily provide its GST number to the vendor.
- Payment of GST and Filing return
The last step is to pay the tax and file the returns on the GST portal. All taxpayers shall file returns monthly and pay taxes monthly. However, in case of small taxpayers (turnover of up to Rs. 5 crores) can file the returns quarterly however the tax payment has to be made monthly.
Return to be filed every month is GSTR-1 and GSTR-3B.
- Payment of GST under RCM
If any service is received from the specified person such as GTA, Advocate, Tribunal, Sponsorship service and Purchase made from unregistered person for an amount exceeding Rs.5000.
- Composition Scheme
If any person whose annual turnover in preceding financial year not exceeded 1.5 Crores and for specified states 75 lakhs.
Tax Rates applicable
| Manufacturers and Traders | 1% (CGST & SGST) |
| Restaurants | 5%(CGST & SGST) |
| Service Provider | 6% (CGST & SGST) |
