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GST INTRODUCTION:

GST : Goods and Services Tax (Dual taxation system)

Structure:

CGST = Central GST

SGST= State GST

IGST= Integrated GST

Transactions:

Interstate transaction (between the state) =IGST applicable

Intrastate(within state) = CGST and SGST applicable

Tax structure:

GST 2% = Gold silver Diamond

GST 5% = Hotel, Medicine

GST 12%

GST 18% = Electronics

GST 24% = Luxury car

GST Exempt = Natural items

GST 24% = 12% CGST

12% SGST

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Types of Dealers:

1. Regular dealer: From 1st April 2019 (20 lakhs & 40 lakhs)

Threshold limits :

Spl category states (20 Lakhs) : Puducherry, Meghalaya, Mizoram, Tripura, Manipur, Sikkim, Nagaland, Arunachal Pradesh, Uttarakhand

Normal Category States (40 lakhs) : Chhattisgarh, Jharkhand, Delhi, Bihar, Maharashtra, Andhra Pradesh, Gujarat, Haryana, Goa, Punjab, Uttar Pradesh, J&K, Assam, Himachal Pradesh, Karnataka, Madhya Pradesh, Odisha, Rajasthan, Tamil Nadu, West Bengal

Advantages: 

INPUT TAX CREDIT AVAILABLE

can do Intersate transaction and Ecommerce Transaction

paid on purchase = input tax

collect tax amount on sales = output tax

2. Composition dealer: (1.5 crores):

Will be paying only small % of tax on annual turn over

MFG : 1.5%

Dis Advantages: 

SHALL NOT COLLECT ANY TAX

INPUT TAX CREDIT NOT AVAILABLE

can not do Intersate transaction and Ecommerce Transaction

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3. Unregistered Dealer:

URD = Unregistered dealer (who have not registered under the gst)

(Their turnover below 40 and 20 lakhs)

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GST forms: Monthly

GSTR1 = sales

GSTR2 = purchase

GSTR3 = payment

GSTR1A / 2A / 3A = autopopulated forms from the gst portal

GSTIN : TAX IDENTIFICATION NUMBER

15 digits: 2 numbers are state

10 numbers are PAN

13 digit = entity code (Number of registration with in state)

14 digit = blank (default)

15 digit =  check digit (to dedect errors)

29AAJCR6636B1Z8

29 = state code

AAJCR6636B = PAN

1 = entity code (No. of reg with in state)

Z = Blank (default)

8 = Check digit number (to dedect erros)

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Use this GSTIN number, Create a company and Activate GST:

1. Create a company (without GST)

2. Press F11 == > enable GST = Yes

Enter Reg Details:

State : Karnataka

Reg Type : Regular

GST applicable from : 1-4-2020

Enter GSTIN : 29AAJCR6636B1Z8

Periodicity of GSTR1 : Monthly

E-way bill applicable : yes

applicable from : 1-4 2020

Threshold limit include : Invoice value

Threshold limit : 50000

Applicable for intrastate : yes

Threshold limit : 50000

Save the changes.

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What is this 15 digit GSTIN (Goods and Services Tax Identification Number)?

Earlier, whenever you buy some services or goods, then the seller used to give you the bill. In that bill, you usually find the TIN (Taxpayer Identification Number). This was unique 11 digit number allotted to each business entity which registers with the commercial tax department.

This TIN registration was mandatory for all Manufacturer/Traders /Exporters/Dealer.

Now, after the entry of GST regime, this TIN is now replaced with 15 digit GSTIN (Goods and Services Tax Identification Number).

So this 15 digit GSTIN (Goods and Services Tax Identification Number) is nothing but the replacement of TIN of VAT era.

Let me explain the same by taking an example of two bills. One bill issued prior to 1st July 2017 and another on or after 1st July 2017. The difference is as below (I am not concentrating on the rate changes of VAT to GST).

What is the structure or format of 15 digit GSTIN (Goods and Services Tax Identification Number)?

GSTIN is a 15 digit unique code which is will be assigned to each taxpayer, which will be State-wise and PAN-based. The structure or format of 15 digit GSTIN (Goods and Services Tax Identification Number) will look like below.

First two Digits-The first digit of GSTIN is state code as per Indian Census 2011. The state codes are as below.

01-Jammu and Kashmir, 02-Himachal Pradesh, 03-Punjab, 04-Chandigarh, 05-Uttarakhand, 06-Haryana, 07-Delhi, 08-Rajastan, 09-UP, 10-Bihar, 11-Sikkim, 12-Arunachal Pradesh, 13-Nagaland, 14-Manipur, 15-Mizoram, 16-Tripura, 17-Meghalaya, 18-Assam, 19-West Bengal, 20-Jharkhand, 21-Orrissa, 22-Chattisgarh, 23-MP, 24-Gujarat, 25-Daman and Diu, 26-Dadar and Nagar Haveli, 27-Maharashtra, 28-Andhra Pradesh, 29-Karnataka, 30-Goa, 31-Lakshadweep, 32-Kerala, 33-Tamil Nadu, 34-Puducherry and 35-Anadaman and Nicobar Islands.

Next 10 Digits-It is the PAN number of a business entity like your shop, mall or company.

13th Digit-It indicates the number of registrations as a business entity has within a state for the same PAN. It will be an alpha-numeric number (first 1-9 and then A-Z) and will be assigned on the basis of the number of registrations a legal entity (having the same PAN) has within one state.

Let say the company ABC registered in the same state for 5 times for different businesses. In such case, this digit will be printed as 5. Let us assume, the same company registered for around 15 times, then it should be represented as F (1-9 numeric and later on 10th registration be named as A and 11th as B and so on up to Z).

Hence, a business entity can register the GSTIN within a single state for the maximum of 35 times (1-9 and later on A-Z).

14th Digit-It will be by default as Z.

15th Digit-The last digit will be a check code which will be used for detection of errors.

Beware consumers!!

Now you came to know what is GSTIN in the new regime of tax format called GST. Whenever you buy and if some one charges you GST, then make sure to check the GSTIN and its format is matching with the structure I explained above.

Many shopkeepers may simply put some random numbers and collect the tax or even they may not print their GSTIN on the bill. Hence, always check for GSTIN than blindly paying the bills.