GST Impact on Event Management

 GST Impact on Event Management

GST Impact on Event Management 

• Event planning or management, in other words, means organizing, planning, promoting, hosting, or conducting all kinds of services. 

• It includes conducting services on conferences, festivals, weddings, ceremonies, concerts, formal parties, conventions, etc. it is all handled and taken care of by the Event Manager. 

SAC for Event management. 

The GST rate on the event management -18%, 

• sac – 998596 - events, exhibitions, conventions and trade shows organisation and assistance services 

• sac – 999621 - Performing arts event promotion and organization services GST Rates 

• Non-entertainment events include seminars, conferences, training, workshop, trips, and treks. Access to Indian Classical dance, circus, folk dance, drama, theatrical performance will be taxed at 18%. 

• The ticket price of these events that is less than Rs 500 is exempted from the GST. (2/2018-CT(R)25.01.2018) 

• Access to entertainment events includes amusement parks, cinematograph films, racecourse, sporting events like the IPL, etc would be taxed at a whopping rate of 28%. 

• But to sell online tickets, they must be registered under the GST, even if that means the sale is less than INR 20 Lakh per annum. 

• Therefore, the GST has brought about relief and difficulties at the same time to different sects of people working in the industry. 

• Place of event helps to charge interstate or intra-state billing. 

• ITC needs to be reversed if non-ticketing events are taking place on proportionate basis.

Composition scheme under GST

 Composition scheme under GST

Limit under GST Composition Scheme - 1.5 crores per annum

Manufacturers – 1%

Restaurants – 5%

Traders – 1%

Who is not eligible?

(a) Dealing with goods not leviable to tax.

(b) Making any interstate outward supplies of goods.

(c) Supply of goods through an electronic commerce operator.

(d) Supply of Ice cream and other edible ice.

(b) Pan masala

(c) Tobacco and manufactured tobacco substitutes

(e) One PAN cannot have regular and composition registration.

Conditions

(a) Neither a casual taxable person nor a non-resident taxable person.

(b) Nil stock of goods of interstate purchase on appointed day.

(c) Nil stock of goods of unregistered purchase on appointed day

(d) RCM applicable.

(e) Shall mention the words “composition taxable person, not eligible to collect tax on supplies” in bill of supply

(g) Shall mention the words “composition taxable person” on every notice or signboard displayed.

Returns

a)  CMP-08 quarterly return before 18^th of first month after quarter

b)  GSTR -04 Annual return before 30^th April of succeeding year.

Important

a)  No Input tax credit

b)  No tax invoice.

c)   Not to tax in the invoice

d)  Bill of supply is must.

Service sector – special – 50 lakhs limit – 6% gst

 

Job Work Under GST

 Job Work Under GST

• 2(68) CGST Act - 'any treatment or process undertaken by a person on goods belonging to another registered person'.

• Sec 143 – job work procedures

• NO GST for movement of goods on job work – Delivery challan to be used for movement.

• Inputs – One year – If not returned to pay tax with interest.

• Capital goods – 3 years. If not returned to pay tax with interest. Commissioner has power to extend the time on case-to-case basis on request.

• Clearance from job worker place is permissible – provided they must be registered under GST, or it should be registered as additional place of business for the principal.

• Proper records to be maintained by both job worker and principal.

• Scrap generated in job worker place can be disposed if job worker is registered under GST or by the principal.

• Job work can be accepted on imports on payment of duty for the imported goods.

• Job work is also possible for exports with proper documents.

• ITC-04 return needs to be filed for job work once in a quarter.

• No need to file nil return if there is no transaction.

• E-waybill generation in applicable cases.

Anti-profiteering

 Anti-profiteering

a)  What is the meaning of anti-profiteering under GST?

b)  Legal provisions in GST Act relating to Anti profiteering – sec 171.

c)  What is the category of goods and services where rates were brought down? – vehicles.,

d)  What were the prices before transition to GST on monthly basis for each of the month for the last one year?

e)  What prices were charged after transition to GST for each of the month?

f)   What were the authenticated costs of each of the product or services before transition?

g)  What were the authenticated costs of each of the product or services after transition?

h)  Companies Act, 2013: Matters falling under Section 148 –

(i) Framing policy framework for cost accounting records and cost audit in the corporate sector.

(ii) Identification of class of companies i.e., the industries/sectors for inclusion/exclusion under the provisions of section 148 of the Companies Act, 2013.

(iii) Prescription of order/rules for maintenance of cost records and cost audit thereof by Companies including review, rationalization and amendment or modification of the existing ones.

Understand your ITC before adjustment

 

Understand your ITC before adjustment

• Input Tax Credit under CGST/SGST | Section 16 to 21 | Rules 36 to 45

 

• ITC cannot be adjusted to payoff liability under reverse charge 9(3) or 9(4)

 

• RCM paid on the GTA services can be claimed.

 

• Export of goods and services are not exempted – we can avail ITC.

 

• Reversal of ITC where payment is not made within 180 days from the date of invoice.

 

• Never Avail ITC on supplies specifically blocked u/s 17.

 

• Never Avail credit when the same is restricted by rate notification.

 

• Never Avail ITC merely on receipt of invoice without actual receipt of goods/services

 

• Reverse proportionate ITC in respect of exempted supplies, non-business purpose use

 

• Avail ITC on bank charges

 

• Reverse of ITC in respect of goods lost, stolen, destroyed, written off or distributed as gifts/free samples.

 

SUSPENSION OF GST REGISTRATION

 

SUSPENSION OF GST REGISTRATION

Rule 21: Additional Grounds for Cancellation of Registration

(a) Does not conduct any business from the declared place of business.

(b) Issues invoice or bill without supply of goods or services in violation of the provisions of the Act, or the rules made thereunder; or

(c) Violates the provisions of section 171 (ANTI-PROFITERING) of the Act or the rules made thereunder.

(d) Violates the provision of rule 10A. (BANK DETAILS)

(e) Avails input tax credit in violation of the provisions of section 16 of the Act or the rules made thereunder; or

(f) GSTR 3B Tax paid is in excess of GSTR 1

(g) Violates the provision of rule 86B – Restriction of usage of ITC (99%)

21A (2) Where the proper officer has reasons to believe that the registration of a person is liable to be cancelled under section 29.

a)  No refund

b)  Stoppage of E-way bills

Impact – Section 51 of the CGST Act is being amended to remove the requirement of issuance of TDS certificate by the diductor and to omit the corresponding provision of late fees for delay in issuance of TDS certificate.

Hurdles to be crossed for availing input tax credit

 

Hurdles to be crossed for availing input tax credit

·       Section 16(1) and (2) – Check condition for availment of ITC

·       Section 17(5) Check eligibility

·       GSTR-2A/2B invoice details reconciliation

·       Payment by vendor – Follow up with vendor whether he filed GSTR-3B and paid GST of invoice issued.

·       Rule 36(4) restriction 105% of eligible ITC in GSTR-2A

·       Rule 42 and 43

·       Rule 86B Restriction for payment of taxes (50 lakhs) through ITC maximum 99%

·       Rule 86A Check whether ITC is blocked or not by officer.

·       Appoint an entire team for above procedure instead of doing business!

 

Isn’t it is so easy to avail ITC?

One may think to expense the ITC itself.

it has become more direct tax rather than indirect tax – Credit has lost its presence itself under GST.