What is GST and Implementation In Tally ERP 9?
Goods and Service Tax (GST) is an indirect tax levied on the supply of goods and services. This law has replaced many indirect tax laws that previously existed in India. Under the GST regime, the tax is levied at every point of sale. In the case of intra-state sales, Central GST and State GST are charged. Inter-state sales are chargeable to Integrated GST.
Intrastate and Interstate GST
Under GST, the supply of goods or services within the same state or Union territory is called as intrastate supply, However, the supply of goods or services to a Special Economic Zone developer or Special Economic Zone unit situated within the same state would not be intrastate supply. As any supply of goods or services to a Special Economic Zone developer or Special Economic Zone unit is classified as intrastate supply.
Under GST, interstate supply attracts Integrated Goods and Services Tax or IGST. Intrastate supply attracts both Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST). In the case of intrastate supply, the GST rate for the goods or services would remain the same. However, the GST rate and tax amount are divided equally into the two heads namely SGST and CGST.
What are the benefits of GST?
One GST rate and one mechanism:
GST ensures that all indirect tax rates are uniform and a product has one GST rate across the country. Hence the tax rate won’t vary from state to state.
The cascading effect of taxes
If a product is produced and sold to the consumer, there would be a single indirect tax. There is no overlapping of taxes. As a result, seamless ‘tax-credits’ occurs which reduces any hidden cost in doing business.
GST improves competitiveness:
GST ensures a significant reduction in transaction costs of doing business and hence increases competitiveness for trade and industries. The GST would help those businesses which have been paying right taxes. Since GST would greatly reduce the tax evasion, the goods business will become more competitive.
Not only, GST replaces various indirect taxes, the new system also makes it easier for businessmen to pay taxes. Currently, a businessman has to pay various taxes, file returns and reply for the scrutiny. The GST would put an end to all these hassles in tax payment. There would be an advanced IT platform for the GST. It makes the entire system of GST payment and returns filing easy and transparent.
Who can Opt for GST?
The GST Council on January 10, 2019, doubled the GST exemption limit to Rs 40 lakh for micro, small and medium enterprises. The GST exemption limit for northeastern and hilly states has been doubled to Rs 20 lakhs.
Enabling GST in Tally ERP 9
The company deal with stock items of one GST rate 18%, therefore, Paras Traders define tax detail at the company level.
To enable GST
- Go toe gateway of tally > click F11: Features >Click F3: Statutory.
- Set the options Enable Goods and Services Tax (GST) to Yes and set /Alter GST details to Yes.
- press Enter view company GST details screen and enter the following details
- State Karnataka
- Registration Type; Regular is selected as the registration type
- GSTN 29AAAAA1234IZS
- Applicable from: 1 July 2017
- Set/alter GST rate details: YES (enabling this option will allow you to define tax details at the company level)
- Press enter to view the GST details Screen