GST, or Goods and Services Tax, is a unified taxation system that merges several indirect taxes under one scheme. It is a consumption-based duty levied on products and facilities. GST combines duties like Central Excise duty, inter-state transportation duty, Service Tax, Value Added Tax, surcharges, Octroi, etc into a single taxation system. There are multiple new streamlined revisions to the GST meaning taxpayers can now benefit from a more transparent taxation scheme.
Recently, the GST council decided to increase the exemption limit from Rs. 20 Lakh to Rs. 40 Lakh. This decision will create better opportunities for Small and Medium Enterprises. Previously, a company would have to pay taxes if its turnover was more than Rs. 20 Lakh. Under the new regulation, they can earn revenues of up to Rs. 40 Lakh without paying any taxes.
The new ruling comes with several facts and GST benefits that a taxpayer should be aware of. Let’s take a look.
The increased exemption limit does not change the rules for registration application under Section 24 of the CGST Act. It mandates registration for a taxpayer under certain circumstances like –
- Individual supplying taxable goods are inter-state.
- Taxpayers are eligible for reverse charges.
- An individual working as an electronic commerce operator.
Suppliers and service providers who fall under these categories have to follow-on with the registration process and pay the applicable GST rate.
Limit for turnovers
The limit for turnovers will change for CGST, SGST, and states that comply with CGST as well.
The increased limit will be only on the selling of goods. An individual who provides services will fall under exemption limit of Rs. 20 Lakh except for UTs.
The aggregated turnover of a taxpayer will determine his/her eligibility for an exemption. It is calculated according to the directive set by Section 22 of the GST Act. The turnover calculation is one of the essential things that taxpayers need to know about GST.
Nil charges of outwards supplies
A business owner cannot charge GST on sales of products, or any such outwards supplies. It will be identified as a cost to the person or consumer who purchases the product.
An individual can be asked for compulsory tax submission against GST meaning that they are obligated to submit the duty within the due date. A taxpayer can appeal against the decision; however, if he/she loses the appeal, the applicant will not be eligible for any Input Tax Credit on future purchases, as per Section 17(5)(i).
Date of implementation
The new upper limit on exemptions will be applicable from 1st April 2019 (FY19-20).
The increased exemption limit will not have any effect on the financial market of India. It will additionally allow SMEs to avail advances and fund their growth. Various financial institutions including NBFCs provide such loans to businesses.
These above mentioned facts about the increased exemption limit will help business owners better understand what is GST and how to avail the maximum profit from this unified system. SMEs and MSMEs are predicted to benefit the most from this new ruling.
12 Tips by Mohit Churiwal to Get Your Brand on Top
Simple Body Work-Outs and How to Motivate Yourselves for Making Your Body Strong
An Interview With Turab Musayev on the Importance of Professional Progression
Entertainment4 weeks ago
22-Year-Old Concert Photographer Nominated for “Best Photographer” Award at the SCM Awards 2020
Entertainment2 weeks ago
Wayz Takes the Lead in the Mexican-American Hip-Hop Scene with His Album ‘Machine’
Entrepreneurs2 weeks ago
Darik Alexander Is An Entrepreneur, Motivational Speaker, And Much More Who Wants To Help People Find Their Financial Freedom
Interviews3 weeks ago
Jon Wolfe: How This Country Star Started His Own Company
Entrepreneurs4 weeks ago
There Are Triple Threats and Then There’s Frederick Tabiyus Nah IV, Who Is a Category of His Own
Entrepreneurs4 weeks ago
Meet LeadJolt – The Smartest Guys in Real Estate Advertising
Life2 weeks ago
A Vision of Hope: Pastor Ché Ahn is Dedicated to Serving His Community
Interviews4 weeks ago
Movers and Shakers Interview with Lil Savvy