GST Network to start collecting traders’ data for issuing tax IDs

3 comments Thursday, August 18, 2016

The network that forms the information technology backbone of the goods and services tax (GST) will start a nationwide drive, in collaboration with state governments, to collect information on around eight million traders and issue them tax identification numbers (TIN) as India prepares to implement the tax from the next fiscal year.

The Goods and Services Tax Network (GSTN), as it is called, has already collated basic information like Permanent Account Number (PAN) and names from existing databases of the income-tax department but needs more detailed data like place of operation, nature of business and bank account details before it can issue a GST ID number to the traders.

All traders will need a GST ID number—a 15-digit PAN-based number—to operate under GST, which is expected to come into effect on 1 April 2017.

As per GSTN estimates, there are around 6.5 million VAT (value-added tax) dealers registered with state tax authorities, and around two million service tax and about half a million excise duty dealers registered with central authorities.

Even if there is an overlap between dealers registered with the centre and the states, GSTN estimates there will be more than eight million traders who will need to be issued GST ID numbers.

“We are making a software where the existing taxpayers can fill essential data, like place of business, name of directors, the nature of their business and bank account details, etc. We are planning to throw this site open in October. Over the next four months, we will roll out a programme in a staggered manner wherein dealers in a state can fill in all their information online,” GSTN chairman Navin Kumar said in an interview.

GSTN and the states will use a mix of newspaper advertisements, media campaigns and direct outreach to encourage taxpayers to provide information about their businesses online.

Kumar said GSTN had asked states to obtain PAN from all the traders and that this exercise has been going on for the past two years.

“We have also verified 90% of the PANs from the income-tax department’s database,” he said. “What we have now is the PAN, the name of the business and details of whether it is a company or a proprietorship. But we couldn’t extract any other information from the states as they were all in different formats.”

To be sure, even after it gathers all the necessary information, GSTN can issue the ID number only after Parliament passes three proposed laws: the Central GST, Integrated GST and the State GST.

“If needed, we can generate the TIN for the eight million taxpayers in one day,” said Kumar.

GST is expected to remove barriers across states and integrate the country into a common market. It will subsume most of the indirect taxes levied by the centre and the states, including excise duty, service tax, VAT, entertainment tax and luxury tax. It will put the entire tax process online—right from registration, tax payment and tax return filing to refunds, audits and assessments—thereby making GSTN a very important part of the GST ecosystem.

“It is going to be a long-drawn exercise because of the huge number of assessees. The earlier they start the better. The law will get passed in the winter session. So it does not make sense to wait till then to collect information about the taxpayers else they will not be able to provide automatic registration to the traders in time,” said R. Muralidharan, senior director at Deloitte in India.
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1 comments Wednesday, August 17, 2016
As the GST Bill is about to come into action by the next year, the government of India is taking necessary steps to make sure that the GST regime works fine. The Government will introduce eight forms namely GSTR-1 to GSTR-8 that will be required to file the GST Tax returns in India. These forms will be collectively used to take the assesses details and offer multiple options to file online return.

As per department issue some draft form for return purpose. These are as below:

*1. GSTR-1 (Sales Register)*

•This is a sales register of goods and services, here we can enter the details data of of sales . If a persons sells his goods and services to a register person within the state in that case he is liable to charge CGST and SGST on the transaction. At the same point of time if the person sells his goods and services to other state he is liable for IGST charge on him.

•Here of each transaction it is important to classify the goods or services with his SAC or HSN code because these codes will identify the nature of the transaction.

•Again for avoidance of the black money or hawala transaction in GST returns, there is a  need to identify  some important transaction like inter state transaction worth Rs. 250000/- or more.

*GSTR- 2 (Purchase Register)*

•This is a comprehensive purchase register. Here we can enter the data of both purchase of service and goods.

•In GSTR-2 the data of the goods purchase from register dealer including debit/credit note will automatically populated as the respective dealers upload there sales register on due date. Due to this we can match our purchases against the sales register and the impact of this in current scenario where tax credit mismatch is hard to match and a time taking process, in GST there we will check our data as per seller return so mismatch issue resolve will solve easily

•As well as here we will amend our purchase bill too as we received in earlier periods

•Here a separate details information will be required for input service distributors

•Due date of filling the return is 15th of the next month. But we can upload our data on daily, fortnight, weekly too. Soon the last date of return filing the workload should be lesser than before

*GSTR-3 (Monthly Return Form)*

•Now the time taking process of return filling is over now. In GST return maximum data of this return is auto populated from purchase and sales registers. Only adjustment entries and challan information will enter after these entries

•Here cash ledger (tax deposit in cash and TDS/ TCS) will made separately for CGST , SGST and IGST

*GSTR-4 (Quarterly return for compounding dealers)*

•This return is a quarterly return filled by the compounding dealer (as per draft GST law the assesses whose turnover is less than Rs. 50 lacs and there is no interstate transaction ) is liable to file return on and before 18th of the month after the quarter

•In this return, data will be automatically populated after filing of GSTR-1
*GSTR-5 (Return file by the Non-Resident)*

•This will be a monthly return filed by the non –resident within 18th day after end of the month and within the 7 days after expiry of registration

•In this return HSN/SAC code should be mention because these are classify the transaction as a sales and purchase of goods and services

*GSTR-6 (Return for Input Service Distributor)*

•This return will be filed by the Input Service Distributors within 15 days after end of the month

•In this return form input service distribution ledger will be maintained. In this ledger credit of CGST, SGST, IGST  will maintain separately of each tax amount

*GSTR-7 (TDS Return)*

•Tax deductor will be liable to file this TDS return within the 10 days after end of the month
•This return form is almost similar to TDS return of income tax (26Q/24Q etc) as in this return deductee information and transaction information is mention with the related challan in which the TDS amount is paid to department

*GSTR-8 (Annual Return)*

•This return form will be filed on or before 31st December of the next financial year

•In this return the total annual returns information will be matched by the department with the monthly /quarterly return filled by the assesse

•In this return auditors information will submitted

•In this return all the transaction will bifurcated within goods and services. This bifurcation should be match with the HSN/SAC code given by the assessee in his monthly/ quarterly return

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No disallowance of ITC for mere technical defect in VAT invoice-HC

1 comments Saturday, August 6, 2016
The Hon'ble Punjab & Haryana High Court in a crucial decision has held that input tax credit cannot be disallowed merely for a technical defect in the VAT Invoice such as non mentioning of words " “Input Tax Credit is available to a person against this copy” as per Rule 54 of the Punjab VAT Rules, 2005.
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