GST Rules Archives | XaTTaX GST Blog

AI, data analytics to track GST evaders, boost compliance

January 3, 2020 admin Comments 0 Comment

The government plans to increase the use of artificial intelligence and data analytics to track down tax evaders, and improve compliance with the Goods and Service Tax in order to augment revenue.

Top tax officials are scheduled to participate in a brainstorming session to be chaired by revenue secretary Ajay Bhushan Pandey next week to firm up this plan.

“The revenue secretary will hold a day-long meeting on January 7 with tax commissioners to discuss ways to streamline the GST system and plug leakages due to fraud,” said a person aware of the development.

The discussions will include assessing the wider use of data analytics and AI in the process of enforcement and red-flagging tax evaders and fake refund claimants without overreach or harassment to genuine taxpayers.

The meeting comes on the heels of the government notifying changes to GST rules to prevent frauds and fake invoicing, besides setting up grievance cells to ensure that genuine taxpayers are not harassed and the overall tax base increases. The government last week reduced input tax credit to 10% from 20% of eligible credit if invoices or debit notes were not reflected in filings.

Last month, the Central Board of Indirect Taxes and Customs instructed field officers to expeditiously create GST grievance redressal committees at zonal and state levels.

Tax officials have been directed to identify cases of suppression of personal income, wilful tax evasion, fake invoicing or inflated or fake e-way bills, and take stern action.

Those attending the session will include state tax commissioners and chief tax commissioners from the Centre, senior officials of various tax bodies along with officers of the enforcement wings. Their goal is to develop a targeted approach to stop tax and duty evasion while making sure that no taxpayer is troubled.

There’s growing concern over revenue shortfall, with slowing consumption demand adversely impacting GST collections. The corporate tax cut amounting to a loss of revenue of Rs 1.45 lakh crore, along with recent GST compensation of over Rs 35,000 crore to states, have increased the stress on the Centre’s fiscal position.

Source: Economic-Times.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Automate Invoicing and get Paid Faster

Integration with all popular accounting software

Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

Latest GST circular puts an end to confusion over new input tax credit rules

November 12, 2019 admin Comments 0 Comment

In a big relief for GST taxpayers, the Union government on Monday clarified the new rules related to availing input tax credit under the GST. It said that a certain category of Input Tax Credit claims such as ITC in respect of the IGST paid on imports and GST paid under the reverse charge mechanism have been kept out of the scope of the new rules introduced last month. The new rules implemented by the CBIC limited input tax credit claims to 20% of the eligible amount where invoice matching has been done. However, the notification issued by the CBIC on October 9 caused a lot of confusion over the method of calculating this 20% amount, the cut-off date and also whether it was to be calculated supplier-wise or on a consolidated basis. These concerns prompted the CBIC’s GST policy wing to issue a new circular today clarifying all these aspects.

“This circular clarifies a few points and will be of help to GST payers,” said Pritam Mahure, a Pune based chartered accountant.

The circular issued by the Central Board of Indirect Taxes (CBIC) also clarified that this 20% cap on the eligible Input Tax Credit will not be calculated supplier-wise and GST payers can avail the input tax credit on a consolidated basis.

The Modi government had received complaints that some businesses were availing input tax credit by using fake GST invoices. In order to check the problem of misuse of input tax credit system, the CBEC, the nodal body to implement indirect taxes in the country, had last month made it compulsory to match the invoices uploaded by the suppliers in their GSTR1 forms before buyers can avail Input Tax Credit in their GSTR-3 returns. However, it also allowed the buyers to claim 20% more input tax credit over and above the eligible amount where invoice matching was done but the lack of clarity over the method of calculation created confusion among GST payers.

The CBIC’s latest circular is intended at clarifying all these aspects. For example, if a buyer is entitled to avail input tax credit of Rs 10 lakh on inward supplies (purchases) in a month but if his suppliers have only uploaded the correct invoices in respect of supplies of Rs 6 lakh only in the GSTR1 forms uploaded by them, then the buyer can avail ITC of Rs 6 lakh plus 20% of the eligible amount that is Rs 1.2 lakh. Therefore the buyer could claim a total ITC of Rs 7.2 lakh in the month.

It also clarified that the total amount of ITC, even after the addition of 20% input tax credit over and above the eligible amount where invoice matching has been done, cannot exceed the total amount of input tax credit that can be claimed.

For example, if a buyer is entitled to ITC of Rs 10 lakh on inward supplies and invoice matching is done in case of Rs 9 lakh then as per the 20% cap rule, he is also entitled to avail 20% over and above the eligible amount of Rs 9 lakh, which is 1.8 lakh in this case. However, this can take the total amount of ITC to be availed by him in the month to Rs 10.8 lakh, Rs 80,000 more than the total ITC amount that can be claimed. The new circular has clarified that in any case ITC claims will be restricted to the total amount due.

The latest GST circular also clarified three distinct cases where the newly introduced rule to cap ITC to 20% over and above the eligible amount will not be applicable.

Where new GST Input Tax Credit rule will not be applicable
The cap of 20% on availing input tax credit under the GST rule 36, sub-rule (4) introduced on October 9 will not be applicable on three cases:

1. ITC in respect of the IGST paid on imports and these importers can directly avail the input tax credit;

2. The cap of 20% will also not apply to those cases where GST has been paid under the Reverse Charge Mechanism (RCM) and;

3. The ceiling of 20% on availing ITC will also not apply on Input Service Distributors (ISD), these are those businesses that receive invoices on behalf of the services used by their branches and subordinate offices.

Source: Financial-Express.

XaTTaX is Best GST Software, Simplify your Financial matters with GST eFiling Software for Return Filing & GST Billing Software in India.

Automate Invoicing and get Paid Faster

Integration with all popular accounting software

Manage your GST and E-WayBill Software anytime anywhere using multiple devices

Get Our GST Software DEMO and E-WAY BILL DEMO for FREE

No GST on Collecting Exam Fee from Students and Remitting same to that Particular University: AAR

November 6, 2019 admin Comments 0 Comment

The Authority of Advance Ruling ( AAR ) in Karnataka has ruled that, the activity of collecting exam fee (charged by any university Or institution) from students and remitting the same to that particular university or institution without any value addition to it is a service as a pure agent and hence the value is excluded from the taxable value of the applicant as per Rule 33 of the Central GST Rules / Karnataka GST Rules, hence exempted from Goods and Services Tax ( GST ).

The Applicant provides coaching, learning and training services in relation to under-graduate, graduate and post-graduate degree, diploma and professional courses on a standalone bases to students or for any institution, corporate, company, institutes, universities and colleges in the subject and branches of all types of disciplines such as commerce, hardware, software, computer, science, arts, business management, engineering, medical, industrial, pharmacy, mining, military, dance, acting, sports, journalism and any other ‘field of education and set up of coaching and training classes/ centers in relation to the same.

The AAR observed that, “The applicant is collecting the exact amount payable to institute or college or universities as exam fee from the students (service recipient) and remits the same amount to the respective institute or college or universities (third party) without any profit element or additions, on the authorization of the student. This payment is separately indicated in the invoice issued to the respective students. The applicant providing this kind of services to the student in ‘addition to the services as training and coaching institute. Hence the applicant satisfies all the conditions of the pure agent as narrated in Rule 33 of the COST Rules, 2017. Therefore, amount of the fee collected by the applicant from the student as exam fee which is remitted to the respective institute or college or universities is excluded from the value of supply”.

Source: Taxscan

Get Your GST Returns Filed Easily and
Effortlessly!!!

Our GST software enables you to file your GST returns free of any hassle. Get more details by writing to us at gst@xattax.in.

Do RWAs need to pay GST on society fee?

August 9, 2019 admin Comments 0 Comment

Even after more than two years of its implementation, there are ambiguities that crop up regarding the implementation of the goods and services tax (GST). For instance, there was little clarity on the applicability of GST on maintenance paid by home owners to residents’ welfare associations (RWAs) for the upkeep of societies. The government recently clarified on this particular aspect.

In a notification dated 22 July 2019, the ministry of finance said that if RWA members contribute less than ₹7,500 a month each, the said RWA is exempt from paying GST, irrespective of the annual turnover.

Note that the rule is not new but was amended to increase the limit. “It is only the clarification that has come recently. The limit was earlier ₹5,000, which was increased to ₹7,500 in January 2018,” said Pratik Jain, partner and leader, Indirect Tax, PwC India. However, RWAs are required to pay GST on monthly subscriptions if the subscription is more than ₹7,500 per member and the annual turnover of the RWA—by way of supplying of services and goods—is ₹20 lakh or more. Also, this GST will be charged on the entire amount of maintenance and not just on the amount exceeding ₹7,500.

The RWA does not need to pay GST if the annual turnover is ₹20 lakh or above, but the members are paying less than ₹7,500 as maintenance charge per month each.

For instance, if a housing society has 100 apartments and the monthly maintenance charges are around ₹4,000 each unit, there will be no need to account for GST, as the monthly contribution is below ₹7,500, even though the annual turnover of the RWA is ₹48 lakh, which is over ₹20 lakh a year. Similarly, if the monthly contribution in a high-end housing society with 10 apartments is ₹15,000 per unit, the annual collection will be ₹18 lakh, which is less than ₹20 lakh a year, the contributions of its members will not attract GST.

GST rules also allow RWAs that have to collect GST on monthly contributions to claim input tax credit (ITC). ITC helps an entity to reduce the GST amount it has paid on goods or services from the amount of GST it has to deposit to the government.

“There were representations made to the government in this regard, and hence, they have clarified. Obviously it is a relief for the residents, particularly those who reside in smaller apartment buildings and complexes. Of course, if you look at the luxury segment, the maintenance amounts might be much higher than ₹7,500. At least it provides relief to a large section of society,” said Jain.

The government’s notification also states that by coming under the ambit of GST, RWAs could in fact lower their tax burden by availing the benefits of ITC, which they would have paid to their suppliers for expenses on goods such as buying generators, water pumps, lawn furniture, taps, pipes, or other hardware as well as for services such as repairs and maintenance.

Ease Your GST Return Filing & Invoice with XaTTaX- GST Software

Source: Live-Mint

GST: 50 Crore E-Way Bills generated till February, says Govt

March 6, 2019 admin Comments 0 Comment

The Central Board of Indirect Taxes and Customs (CBIC) has confirmed that till 28th February 2019, 50 crores E-Way Bills have been generated through the online portal under GST regime.

“Total no. of e-way bill generated across India crosses 50 crore mark from April 1, 2018, to Feb 28, 2019,” CBIC tweeted.

The Goods and Services Tax Network (GSTN), which is the IT backbone of the GST had earlier said that between September 1st to 18th, over 2,72,58,344 E-Way Bills have been generated in the country.

Under GST rules, ferrying goods worth more than Rs 50,000 within or outside a state will require securing an electronic-way or e-way bill through prior online registration of the consignment.

From April 1, the government had implemented the electronic way or e-way bill system for moving goods from one state to another. The same for intra or within the state movement has been rolled out from April 15.

The number of e-way bills generated from April 1st to till August 31st had crossed 20 crores. The first 10 Crore E-way Bills generated in 83 days while next 10 Crore E-way Bills Generated in 66 days.

From, April this year, the Government is all set to integrate NHAI’s FASTag mechanism from April to help track movement of goods and check GST evasion.

In a further development, the Government is also planning to integrate GST returns to the E-way Bills.

Besides, all these, the Government to form a committee of tax officers to suggest steps to deal with bogus e-way bills as there are many instances of bogus e-way bills and fake invoices have come to the notice of the CBIC since April last year.

XaTTaX: Cloud and On-Premises Based GST Filing Software For India

Source: Tax Scan.

GST Council proposes slew of changes in the GST law to make it business friendly

July 10, 2018 admin Comments 0 Comment

A panel comprising government officials have floated a draft amendment, proposing certain compliance-related changes to the current Goods and Services Tax (GST) regime. It may be noted that the panel has recommended changes in at least 46 categories of amendments to further simplify the indirect taxation system that came into effect last year. According to a PTI report, if the draft changes are amended, employers in companies will be able to leverage the fresh changes to claim input tax credit on a slew of facilities like food, transport, insurance that is provided to employees.

As the government had earlier claimed, it would be bringing in more entities with the fresh draft to help citizens. It may be noted that there are several amendments that have been planned to streamline the regime – omission of liability to pay tax on reverse charge has been touted to be one of the biggest changes; the new return filing procedures are expected to make compliance easier and would allow more service providers to opt for the composition scheme. The draft notification is open for stakeholder and public comments till July 15.

Also Read: GST panel recommends no extra tax incentives for digital transactions

Once the draft amendments get a final nod from the revenue department, they will be placed before the GST Council for approval when they meet on July 21. Following that, the recommendations will be placed before the Parliament and state legislatures during the Monsoon Session for amending them.

“Provided that the input tax credit in respect of such goods or services or both shall be available, where the provision of such goods or services or both is obligatory for an employer to provide to its employees under any law for the time being in force,” the draft amendments said. However, it will not apply in for other services such as membership to health and fitness centres, clubs, and other transport benefits offered by the employer.

Speaking to the news agency on the matter, Abhishek Jain, Partner, EY, said, “With the proposed GST amendment to allow credits like rent-a-cab, insurance, etc when mandated under any law, the pool of credits for businesses like BPO’s, factories, etc may witness an increase. However, explicit denial of ITC for insurance, repair, maintenance, etc of vehicles may entail higher tax costs on car-related expenses for businesses.”

Under the fresh amendments e-commerce companies are also not required to seek registration under GST if their annual turnover is less than Rs 20 lakh, the report added. Other than that, they are not required to collect tax at source as per Section 52.

The government said that the measures are aimed at making the regime taxpayer-friendly, with an aim to help small e-commerce firms and most other small-scale employers. The government, on July 1 celebrated GST Day, claiming that it has helped in significant growth and exuded confidence that it would do be able to streamline it to make it an easier indirect taxation system.

Source: Times Now News

GST rule changes: 12 things to know

October 7, 2017 admin Comments 0 Comment

The decision to reduce the compliance burden of small companies and traders, comes just two days after Prime Minister Narendra Modi address regarding concerns over implementation of GST.

Arun Jaitley : GST

Three months after the rollout of the indirect tax regime, the Goods and Services Tax (GST) Council, following a meeting on Friday, announced relief to small and medium businesses on filing and payment of taxes, and also eased rules for exporters and cut tax rates on 27 common use items.

After the meeting, Finance Minister Arun Jaitley said, “GST Council has considered the implementation experience of the last three months and gave relief to small traders… Compliance burden of medium and small taxpayers in GST has been reduced.”

The relief granted to small and medium enterprises comes after complaints of tedious compliance burden under the GST that was intended to be a simple indirect tax regime which replaced over a dozen Central and state taxes.

The decision to reduce the compliance burden of small companies and traders, came two days after Prime Minister Narendra Modi address regarding concerns over implementation of GST where he said that he had asked the Council to identify bottlenecks faced by small and medium enterprises.

Read: 100 days of GST: From launch to scope of reducing slabs, journey of the tax reform so far

Here’s the full list of recommendations made by the Finance Minister during the meeting:

Composition Scheme

1. The composition scheme will be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as against the previous turnover threshold of Rs 75 lakhs. This threshold of turnover for special category States will be increased to Rs 75 lakhs from Rs 50 lakhs, while the turnover threshold for Jammu & Kashmir and Uttarakhand will be Rs 1 crore.

2. It has been decided that such People who are otherwise eligible for availing the composition scheme and are providing any exempt service(such as extending deposits to banks for which interest is being received), will be eligible for the composition scheme.

3. To make the composition scheme more attractive, a Group of Ministers (GoM) will be constituted to examine measures.

Relief for Small and Medium Enterprises

4. It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs 20 lakhs (Rs. 10 lakhs in special category states except for J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.

5. To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs 1.5 crores, a recommendation has been made that such taxpayers will be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxes only on a quarterly basis, starting from the Third Quarter of this Financial Year i.e. October-December, 2017.

6. To benefit small businesses and substantially reduce compliance costs, the reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-section (4) of section 5 of the IGST Act, 2017 will be suspended till March 31, 2018 and will be reviewed by a committee of experts.

7. In order to mitigate inconvenience faced by small dealers and manufacturers, it has been decided that taxpayers having annual aggregate turnover up to Rs 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies will be payable only when the supply of goods is made.

8. In order to remove the hardship being faced by small unregistered businesses, the services provided by a Goods Transport Agencies (GTA) to an unregistered person will be exempted from GST.

Other Facilitation Measures

9. After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalisation of TDS/TCS provisions will be postponed till March 31, 2018.

10. In order to give trade and industry more time to accustom itself with the GST regime, the e-way bill system will be introduced in a staggered manner with effect from January 01, 2018 and then will be rolled out nationwide with effect from April 01, 2018.

11. The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 will be extended to November 15, 2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 will be extended to November 15, 2017.

12. Invoice Rules are being modified to provide relief to certain classes of registered persons.

Ease Your GST Filing & Invoice with XaTTaX GST Software

Source: Indian Express

XaTTaX GST Blog

GST News | GST Updates | GST Software

Browsed by
Tag: GST Rules