GST for Small Business

Goods & Service Tax (GST) has been implemented in India since July 2017.  Procedure for GST registration is centralized and standardized similar to service tax registration.

Businesses no longer need to obtain multiple VAT registration.  A single GST registration is applicable across India. The standardized registration procedure improves ease of starting a new business in India.

Effect of GST on small business

  • A supplier whose aggregate turnover in a financial year does not exceed Rs 20 lakh does not need GST registration.
  • Many SMEs may not have the technical expertise to deal with online systems.  They might need intermediaries to register for them. This will add to registration cost.
  • Relevant Returns have to be filed first before refunds can be claimed.  Processing of refund also depends on compliances of supplier and supplier rating.
  • Every registered taxpayer has to file minimum thirty-seven Returns during a financial year.

Advantage of GST for SME

  •         Ease of starting new business
  •         Faster logistics and delivery
  •         Reduction in tax burden

Documents (copies) required for GST registration

Sole Proprietorship Firm

  1. Certificate of Registration like MSME or Shop Act license (not compulsory)
  2. Proprietor’s Personal PAN Card
  3. Proprietor’s Aadhaar Card
  4. Firm’s current bank account statement or personal savings bank account statement
  5. Electricity bill or landline or water bill of the firm’s office premise
  6. Commercial Rent Agreement of office premise (if building is rented/leased)
  7. Building tax receipt (if building is owned)
  8. No Objection Certificate (if building is owned by any other family member of proprietor)
  9. Passport size photograph of proprietor
  10. Digital Signature Certificate (DSC) for GSTR monthly filing

Partnership Firm

  1. Certificate of Registration
  2. PAN Card of Partnership Firm
  3. Partnership Deed of the firm
  4. Current bank account statement of Partnership Firm
  5. Declaration provided by single partner (format will be sent by us)
  6. Partners’ PAN Card
  7. Partners’ Aadhaar Card or Passport (optional)
  8. Electricity bill or landline or water bill of office premise
  9. No Objection Certificate from landlord of office premise (if premise is rented/leased or belongs to any other family member)
  10. Commercial Rent Agreement of office premise (if premise is rented or leased)
  11. Building tax receipt (if building is owned)
  12. Passport size photographs of all partners
  13. Digital Signature Certificate (DSC) for GSTR monthly filing

Private Limited Company (Pvt Ltd)

  1. Certificate of Incorporation (COI)
  2. Company’s PAN Card
  3. MOA & AOA of company
  4. Company’s current bank account statement
  5. Declaration provided by Board of Directors (format will be sent by us)
  6. Board Resolution (format will be sent to us)
  7. PAN of all directors
  8. Aadhaar Card number or Passport number of all directors (optional)
  9. Electricity bill or landline or water bill of office premise
  10. No Objection Certificate from landlord office premise (if premise is rented/leased or belongs to any other family members)
  11. Building tax receipt (if building is owned)
  12. Commercial Rent Agreement of office premise (if premise is rented/leased)
  13. Passport size photographs of all directors.
  14. Digital Signature Certificate (DSC for GSTR monthly filing)

Limited Liability Partnership (LLP)

  1. Certificate of Incorporation
  2. PAN Card of LLP
  3. Partnership Deed of company
  4. Current bank account statement of LLP
  5. Declaration provided by single partner of LLP (format will be sent by us)
  6. Partners’ PAN Card
  7. Partners’ Aadhaar Card or Passport (optional)
  8. Electricity bill or landline or water bill of office premise
  9. No Objection Certificate from landlord office premise (if premise is rented or leased or belongs to any other family member)
  10. Commercial Rent Agreement of office premise (if premise is rented or leased)
  11. Building tax receipt (if building is owned)
  12. Passport size photographs of all partners
  13. Digital Signature Certificate (DSC) for GSTR monthly filing

GST Slab for Different Types of Business

  •         GST Tax Slab of 0%

Goods: Milk, fruits, fresh vegetables, bread, salt, bindi, curd, sindoor, natural honey, bangles, handloom, besan, flour, eggs, stamps, printed books, judicial papers, newspapers, etc.

Services: All hotels and lodges that carry a tariff below ₹ 1,000

  •         GST Tax Slab of 5%

Goods: Skimmed milk powder, fish fillet, frozen vegetables, coffee, coal, fertilizers, tea, spices, pizza bread, kerosene, ayurvedic medicines, agarbatti, sliced dry mango, insulin, cashew nuts, unbranded namkeen, lifeboats, etc.

Services: Small restaurants, transport services like railways and airways, standalone AC / non-AC restaurants, restaurants which serve liquor & takeaway food, restaurants in hotels with room tariff less than ₹7,500 (no input credit for these restaurants)

  •         GST Tax Slab of 12%

Goods: Frozen meat products, butter, cheese, ghee, pickles, sausage, fruit juices, namkeen, refined sugar, tooth powder, medicine, umbrella, instant food mix, cell phones, sewing machine, man-made yarn, etc.

Services: Business class air tickets

  •         GST Tax Slab of 18%

Goods: Cornflakes, pasta, pastries, cakes, detergents, washing & cleaning preparations, safety glass, mirror, glassware, sheets, pumps, compressors, fans, light fitting, chocolate, preserved vegetables, tractors, ice cream, sauces, soups, mineral water, deodorants, suitcase, briefcase, vanity case, oil, powder, chewing gum, hair shampoo, preparation for facial make-up, shaving & after-shave items, washing powder, detergent, stones used in flooring, marble & granite

Services: Restaurants located inside hotels with tariffs of ₹7,500 and above (input tax credit to be available), outdoor catering, IT & Telecom services, financial services, branded garments, etc.

  •         GST Tax Slab of 28%

Goods: Over 200 goods including sunscreen, pan masala, dishwasher, weighing machine, paint, cement, vacuum cleaner, automobiles, hair clippers and motorcycles

Services: Five-star hotels, racing, movie tickets, betting at casinos & racing

GST Compliance for Businesses

  • Invoices should contain the mandatory fields mentioned in GST rules
  • Details of the invoice issued must be provided by the supplier on GSTN portal. Invoices issued should be serially numbered electronically through the common portal
  • Returns should be filed in a timely manner. Returns need to be filed even when there is no business activity for the specified return period (nil return).  All returns must be filed online on GSTN portal
  • Filing date for GSTR-3B has been extended to March 2018
  • All businesses to file GSTR-3B monthly by 20th of the following month until March 2018
  • All businesses to file GSTR-1 and GSTR-3B every month until March 2018
  • GSTR-2 and GSTR-3 filing dates for July 2017 to March 2018 will be worked out later by a Committee of Officers
  • Businesses with turnover under Rs 1.5 Cr to file quarterly GSTR-1
  • Businesses with turnover above Rs 1.5 Cr to file monthly GSTR-1

Tips on filing GST Returns by yourself without hiring an Accountant

  •         Monthly Details of outward supplies are to be filed in FORM GSTR-1.
  •         Monthly Details of inward supplies are to be filed in FORM GSTR-2.
  •         Monthly Filing of Return along with tax payment to be done in FORM GSTR-3B by 20th of every month.
  •         Use GST offline tool for filing return.
  •         Use GST online tool or tally GST software for filing return.
GET PROFESSIONAL GST SUPPORT FOR YOUR BUSINESSCONTACT US
+ +