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GST TAX Benefits & Possible Issues

GST is probably the biggest tax reform ever made in India, so read along to see the major benefits this could bring to your business.

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The present tax structure in India is very complex which determined the Indian government to pass the Goods and Services Tax Bill (GST), which will replace all current tax laws and merge all taxes into one.

This system will roll out in July 2017 and hopefully will unify the entire Indian market, making it easier and more attractive to do business.

GST Tax Advantages:

Free Movement of goods

Free Movement of goods

Eliminating CST(Central Sales Tax) plus other state entry taxes, free movement of goods across the country will be enabled with the help of IGST. This means that businesses will be able to sell more in other states, helping the logistics sector save around $200 billion annually.

Reduced costs

By applying a single tax, the cost of goods will go down. Businesses will benefit from reducing this tax burden and consumers will enjoy cheaper products. GST tax is beneficial because it only applies to value addition and removes tax cascading.

Reduced Costs
Easier tax compliance

Easier tax compliance

The simplified tax structure results in reducing the hassle filling tax forms by merchants. All aspects from registration for GSTIN to filing monthly tax returns and payments will be managed through the online GST portal.

Simplified tax collection

With less tax laws, there will be less intervention from tax authorities. GST will combine all current tax departments and authorities into one, hopefully bringing more transparency.

Simplified tax collection
Reduced Excise Duty Exemptions

Reduced Excise Duty Exemptions

The government loses around Rs.3.1 lakh crore due to excise duty exemptions. With GST, the number of exemptions offered by the government is expected to lower, thus minimizing the loss.

GST, short for Goods and Services tax, is a new tax that will be imposed on the sale and purchase of goods and services in India. GST is meant to replace all taxes in India with a single unified tax applied to value addition instead of the total value of the product at each stage in the supply chain.

This method provides credit for the input tax paid on the purchase of goods and services, which can be offset with the tax to be paid on the supply of goods and services. As a result, this reduces the overall manufacturing cost, with the end customer paying less.

With certain current taxes remaining, the following goods and services will be fully or partially exempted from the GST
Free movement of goods: Business owners will be able to sell more in other states without having to worry about interstate transaction costs. With GST, the entry tax will be eliminated, which will save time and money spent.
Currently, there are many indirect taxes that both the state and central governments are collecting on every purchase and sale.
The GST will follow a similar model with the one before it
GST will have a 4-tier tax structure
One of the main reasons for GST being introduced in India is the tax burden that falls both on companies and consumers. With the current tax system, there are multiple taxes added at each stage of the supply chain, without taking credit for taxes paid at previous stages. As a result, the end cost of the product does not clearly show the actual cost of the product and how much tax was applied. This cascading structure is too complex and inefficient.
For inter-state transactions, the Centre will levy Integrated GST (IGST), which is equal to the average of the CGST and SGST rates. After applying IGST, CGST and SGST credits received from purchases, the seller will then pay the remaining IGST on the added value.
Businesses with turnover revenue of 20 lakhs and above will have to register and file for GST returns, with a threshold of 10 lakhs for businesses in the north east and hill states.
A combination of CGST and SGST will be applied to the import of goods and services that come to India. Tax benefits and credits will be given to the state where the imported goods and services are consumed.

GST Issues for small businesses vs Advantages of
using GST Billing software



GST Issue

Using GST Compatible Invoices

Invoices that are compatible with the GST system need to be issued and double checked to ensure they have the correct data structure.

GST Issue

Keep all invoices for claiming input tax credit

Storing data on computer hard drives is messy, data can get lost or someone can accidentally delete important files.

GST Issue

Get paid on time

Because GST returns are done 3 times in a month, businesses need to make sure they have enough cash flow to run the daily operations.

GST Issue

Apply the right amount of tax, no errors allowed

GST rates and structure are meant to be easy to use, but every business has to make sure they use the right tax rate for every invoice they make.

GST Issue

Easy access to financial data

Businesses will need to have all their data in an easy to access place, ready to be uploaded to the GST servers.

GST Issue

Allocated budget for adopting GST

Adapting to GST will most likely cost any business money. Small businesses don’t have the budget of big enterprises and can’t hire a team of accountants and advisors to help, so what will they do?

GST Advantage

Have ready to use GST invoice templates

Make the right invoices for your clients with ready made GST invoice templates. Have your invoices report available in a GST compatible format,in just a few clicks.

GST Advantage

Control your financial data

Using an online billing system is crucial for GST. It will be much easier to keep track of all the invoices sent and manage all your payments.Filing reports also gets much easier with an integrated system and will save you and your accountant time and money.

GST Advantage

Get paid faster!

Keep track of payments with specialized reports and know each time an invoice is overdue. Your clients will get automated notifications for payment, which helps you get your money on time.

GST Advantage

No more errors!

In Aster Bill Online you can avoid any errors by easily applying cGST, sGST and iGST for every invoice

GST Advantage

Your data is safely stored online

Having your data easily accessible anytime, anywhere, from your computer or tablet is great. Forgot to check something? Don’t worry, just log in to Aster Bill Online and you’ll find all your documents there.

GST Advantage

Aster Bill Online, the best GST billing solution!

Billing software that is compatible with GST and helps you file your GST returns, is the key when it comes to complying with the GST laws.

Take advantage of changing times and use Aster Bill GST compatible software to help your business thrive.

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