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.

 

Simple note on E Invoice

 

Simple note on E Invoice

Right now, for more than 500 crores TO. WEF 1.1.2021 – above 100 crores TO

E-Invoice

·       API (Application Programming Interface):

·       JSON = Java Script Object Notation:

·       IRN = Invoice Reference Number

Applicable to Which Transactions

·       Taxable B2B Supply of Goods or Services Including B2G sales

·       For B2C sales separate provisions of Dynamic QR Code are applicable. 

·       Export

·       Inter GSTIN Transfer same PAN

·       RCM Invoices by supplier if he is notified for e-Invoice.

Not Applicable to which Transactions

·       B2C sales For B2C sales separate provisions of Dynamic QR Code are applicable

·       Sales of GST Exempt products by taxpayer to which E-invoice is applicable

·       Materials sent for or returned after job work.

·       Intra GSTIN Transfer Same PAN

Applicability to Documents

·       Invoice

·       Debit Note

·       Credit Note

It is not applicable to

·       Delivery challan.

·       RCM self-invoices

·       Receipt for Advance payment for Service

GST - October 2020 Updates

 GST - October 2020 Updates

Rule – 59

Invoice furnishing facility for quarterly return filers– less than 50 lakhs TO in each month - first and second month in IFF and third month in GSTR -1

Rule – 60

Inward supplied to be looked at from GSTR 2A on monthly basis – On quarterly basis GSTR 2B will be available for confirmation

Rule – 61

GSTR 3B filing dates – 22^nd for some states and 24^th for other states

GSTR 3B for ISD – 20^th

Rule 61-A

Quarterly return filing needs to indicate their preference – else not eligible for quarterly return

Rule 39(1)

GSTR 1 monthly return due date – 11^th of next month and quarterly return filers – 13^th

Rule 61A(1)

Up to 5 crores aggregate turnover – can opt for quarterly return from jan 21 – but should have filed all previous returns before such option – change the same between 5^th dec 20 to 31^st jan 21

Sec 39(7)

Quarterly return filers needs to pay 35% of tax paid in the last quarter

E- Invoice for 100 crores turnover effective 1^st jan 2021