Tag: Opinion

GST- A Life style Reform

“The GST is not just a tax reform it is a lifestyle reform that will change the way business is carried out in India”.

The level of unpreparedness is even greater among small businesses and tiny outfits. Many small entrepreneurs feel they can bypass the GST if their turnover is less than Rs 20 lakh. The GST Input Credit can only be taken when the buyer is also registered under GST. There is every possibility that the seller wants to take credit of the GST input credit otherwise the entire tax is to be borne by his business. Though the turnover is less than Rs.20 lakhs it is advised that all are registered under GST.

Computer usage under GST

GST is requiring a high level of Computer Usage and all the Information is to be online. Everything is to be updated regularly. Every Business that is coming under GST need to file 37 returns (three returns per month and one annual return) per state p.a. If the Business is done from more than one state, the number of return is multiplied accordingly.

Digitization

The government has banned cash transactions of Rs 2 lakh or more from April 1, 2017, through the Finance Act 2017.The newly inserted section 269ST in the Income Tax Act bans such cash dealings on a single day, in respect of a single transaction or transactions relating to one event or occasion from an individual. The restriction is not applicable to any receipt by government, banking company, post office savings bank or co-operative bank, the tax department said.

The receiver of the amount will have to cough up an equal amount as penalty.

Impact of GST

Today, business enterprises are paying VAT on transfer of property in goods, but after GST implementation taxes must be paid on the invoice or payment, whichever is earlier.

GST will facilitate movement of credit from different locations within a legal entity which in the current scenario is not possible and leads to blocking of working capital.

In the case of sale of solutions at different prices to different consumers, Anti-profiteering clauses will not be applied. There are valuation procedures to be applied to gauge the rationale of the valuation.

Habit of In time Saves Money

Do not take unusual excuses which the British Governments Tax Collector would receive generally from the Customers who fails to file their return in time such as “My tax return was on my yacht … which caught fire” “A wasp in my car caused me to have an accident and my tax return, which was inside, was destroyed,” was another, . “My wife helps me with my tax return, but she had headache for 10 days” while several blamed children, partners or colleagues for inadvertently destroying their forms. Continue reading “Habit of In time Saves Money”