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Deep dives and practical guides written by the WFYI team.
Comprehensive explanations, FAQs, and updates about GST regulations, returns, and compliance.
This guide provides a comprehensive overview of the Electronic Cash Ledger in GST, detailing its structure with major and minor tax heads. It includes a recent regulatory update on ledger adjustments using RBI's e-Scroll if bank details are missing. Furthermore, the article offers a clear, step-by-step process for taxpayers to easily access and review their Electronic Cash Ledger on the official GST Portal.
Businesses not previously registered under VAT may still be able to claim Input Tax Credit (ITC) for VAT paid on goods in stock when they transition to GST. This claim is permissible if certain conditions are met, including proof of payment or specific circumstances for claiming a percentage of SGST/IGST. The facility was intended to ease the transition for businesses from the old tax regime to the Goods and Services Tax framework.
The introduction of GST in India will lead to a smaller base of registered taxpayers compared to the combined VAT and Service Tax systems. This is primarily due to a higher registration threshold of INR 20 lakhs, exempting many smaller businesses. Despite this reduction, tax revenue is unlikely to decrease, as most revenue originates from larger taxpayers with annual turnovers exceeding INR 1.5 crores.
This article clarifies the concept of exempt supplies under India's Goods and Services Tax (GST) framework, differentiating them from nil-rated, zero-rated, and non-taxable supplies. It explains the conditions under which exemptions are granted, their classification, and the implications for Input Tax Credit (ITC) reversal. The piece also details the process for determining ITC attributable to exempt supplies and outlines the 'negative list' of non-GST transactions.
Gross Domestic Product (GDP) is a key metric for evaluating a nation's economic performance and capacity, influencing societal factors like employment and poverty. This article explores the concept of GDP, its various classifications such as Real and Nominal GDP, and detailed calculation methodologies including the expenditure, output, and income approaches. It also highlights India's GDP projections for 2025-26 and discusses the inherent limitations of GDP as a sole indicator of overall societal well-being.
Ahead of the GST rollout, major Indian companies are expressing apprehension about the preparedness of their SME suppliers. While large enterprises are ready, non-compliant suppliers could impede Input Tax Credit flow and cause initial cash flow difficulties across the economy. This concern highlights the need for widespread readiness among all stakeholders.
In May 2017, the fourteenth GST Council meeting took place in Srinagar with the critical goal of finalizing Goods and Services Tax rates. Finance ministers from 32 states and Union Territories attended this important gathering. Their discussions focused on establishing tax rates for over 6,000 goods, thereby completing the final implementation details for GST.
Initial announcements from the GST Council suggested a reduction in economy airfares. However, the aviation sector is now contemplating increasing ticket prices. This adjustment aims to offset higher operational costs, including additional taxes on imported spares and aircraft lease rentals under the new GST framework, impacting the industry's already slim profit margins.
Vendor management is a crucial practice for businesses to optimize costs, ensure quality, and reduce risks by systematically engaging with suppliers. This guide defines vendor management, highlights its importance, and details its key components and operational processes. It also covers strategic benefits, common challenges, and recommended best practices for effective vendor relationships.
This article clarifies the GST regulations for goods sent out on approval before the GST regime commenced on July 1, 2017. It details the tax liabilities when such goods are returned, distinguishing between returns made within six months and those occurring afterward. Additionally, the article outlines the requirements for invoice issuance and the specific GST form, TRAN-1, that must be submitted for these transactions.
The Electronic Cash Ledger, Form GST PMT-05, is a crucial component within the GST framework, detailing all tax payments made via net banking, debit cards, and over-the-counter transactions. This article explains the format of Form GST PMT-05 and outlines the various types of credit and debit transactions reflected in it. It includes an example illustrating how different financial activities, such as deposits, tax payments, interest charges, and refunds, are recorded in the ledger. Key considerations for maintaining the ledger, including reference numbers and liability descriptions, are also provided.
This article clarifies the format and purpose of Form GST PMT-02, the electronic credit ledger, in the Indian GST system. It explains how registered taxpayers use this form to track their utilized and available Input Tax Credit, including provisional ITC details applicable until December 2021 and information on mismatches. The content also provides a practical example to illustrate how ITC is managed and adjusted within the ledger for various tax components.