Type of taxes
1. Direct tax
A direct tax is a tax that a person or organization pays directly to the entity that imposed
it.
Examples : income tax, real property tax, personal property tax
Income tax act 1961
2. Indirect tax
Indirect tax is the tax levied on the consumption of goods and services. It is not directly
levied on the income of a person. Instead, he/she has to pay the tax along with the price
of goods or services bought by the seller
Examples : Goods and Service Tax, Customs Duty
Income tax slab rate
I. Old scheme
a. Age less than 60
Income rate
Upto 250000 0
250000-500000 5
500000-1000000 20
Above 1000000 30
b. Age between 60 and 80
Income rate
Upto 300000 0
300000-500000 5
500000-1000000 20
Above 1000000 30
c. Age more than 80
Income rate
Upto 500000 0
500000-1000000 20
Above 1000000 30
Plus health and education cess @4%
II. New scheme
Income rate
Upto 250000 0
250001-500000 5
500001-750000 10
750001-1000000 15
1000001-1250000 20
1250001-1500000 25
Above 1500000 30
Not available any deduction
Plus health and education cess @4%
TDS (Tax Deduction at Source)
1. Deductor
The person who deducting TDS from Deductee. Payer (who paying amount to someone)
2. Deductee
The person from whom deducting TDS
3. When deducting TDS
When payment made
4. Rules related to Deductor
Deductor need TAN number
5. Rules related to Deductee
Deductee need PAN if no PAN deduct TDS 20% for all section
[Link]. Section Limit rate payee
1 192 salary Average rate Slab
rate
2 193 interest on securities 5000 10
3 194 dividend 5000 10
4 194B Winning from lotteries 10000 30
5 194C Payment to contractor Single payment 1 Individual/
exceed 30000 HUF
Or total 100000 2 Other than
individual/
HUF
6 194D Insurance commission 15000 5
7 194G Commmission on sale of 15000 5
lotteries
8 194H Commission or brokerage 15000 5
9 194I Rent on plant and machinery 240000 per year 2
Rent on other asset 240000 per year 10
10 194IA Payment on transfer of 50lakh 1
immovable property other than
agricultural land
11 194J Fees for professional or 30000 2
technical service
1. Fees or technical service
forsale, distribution,
exhibition of
cenimography films
2. Business of operation of 30000 2
call centre
3. Other cases 30000 10
12 194K Income in respect of units * 5000 10
13 194N TDS on Cash withdrawal 20 lakh- 1crore 2
(previous year) Above 1 crore 5
Goods and Service Tax (GST)
Introduction to GST
GST levied on supply of goods and services
What is goods
as every kind of movable property other than money and securities but includes
actionable claim, growing crops, grass and things attached to or forming part of the land which
are agreed to be severed before supply or under a contract of supply.
Goods which are not covered GST law
1. Petrol, high-speed diesel, aviation turbine fuel, crude oil.
2. Electricity
3. Alcohol used for human consumption
4. Natural Gas
What is service
Anything other than goods
Type of registration
1. Regular
Sales limit
Persons providing services need to register if their aggregate
turnover exceeds Rs. 20 lakh (for normal category states) and Rs. 10
lakh (for special category states
Due date of tax payment
20th Day of the Next Month
2. Composition dealer
Sales limit
increasing the upper limit of annual aggregate turnover (for the
previous financial year) to opt into the composition scheme from Rs 1
crore to Rs 1.5 crores. However, the limit remains Rs 75 lakhs for N.E
states & Uttarakhand
GST composition rules
• No Input Tax Credit can be claimed
• No Inter-state supply of goods can be done
Tax rate
• An eligible Manufacturer has to pay 2% (1% CGST and 1% SGST/ UTGST) of
turnover in a state or Union Territory, as the case may be.
• An eligible person engaged in making supplies supplier of restaurant Service has
to pay 5% (2.5% CGST and 2.5% SGST/UTGST) of turnover in a state or Union
Territory, as the case may be.
• An eligible person engaged in any other supply has to pay 1% (0.5% CGST and
0.5% SGST/UTGST) of turnover in a state or Union
Due date of tax payment
18th Day of the Next Month of Quarter
Type of tax
1. Input tax
The Goods and Services Tax (GST) paid by a taxable person on any
purchase of goods and/or services that are used or will be used for business.
2. Output tax
the tax chargeable under this Act on taxable supply of goods or services or both
made by him or by his agent but excludes tax payable by him on reverse charge basis
What is supply
1. Supply should be of goods or services.
2. Supply should be made for a consideration
3. Supply should be made in the course or furtherance of business
Type of supply
1. Intra state supply
Levy GST on taxable supply of goods or services or both, which takes place within
a state or union territory
2. Inter-state supply
Where the location of the supplier and the place of supply of goods or services
are in
a) Two different states
b) Two different union territories
c) A state and a union territory
Is treated as inter-state supply
Type of GST
1. Central Goods and Service Tax (CGST)
2. State Goods and Service Tax (SGST) or
3. Union Territory Goods and Service Tax (UGST) (UTGST)
4. Integrated Goods and Service Tax (IGST)
When you are doing intra state supply tax amount will split CGST and SGST/ UGST equally
When you are doing inter-state supply tax amount will pay IGST
Tax rates
1. 0%
2. 5%
3. 12%
4. 18%
5. 28%
Apart from these, GST on gold is 3% and 0.25% of semi-precious and rough stones
Time of supply
When we need to record GST
Goods
The date of issue of invoice
Or
The date of payment whichever is earlier
Service
1. If the invoice issuing within 30 days from the completion of service
Date of invoice
Or
date of payment
whichever is earlier
2. If the invoice not issuing within 30 days from the completion of service
Date of completion of service
Or
date of payment
whichever is earlier
3. When advance money received
Reverse Charge Mechanism (RCM)
Means the liability to pay tax by the recipient of supply of goods or services or both instead of
the supplier of such goods or services or both. When supplying following goods and services recipient
must pay tax to government
Goods
1. Cashewnuts (not shelled/peeled)
2. Bidi wrapper leaves
3. Tobacco leaves
4. Raw cotton
5. Supply of lottery
6. Silk yarn
7. Used vehicles
8. Seized and confiscated goods
9. Old and used goods
10. Waste and scrap
Services
1. Supply of services by a GTA to business entity
2. Legal service
3. Services supplied by an arbitral tribunal to a business entity
4. Services provided by way of sponsorship to any body corporate or partnership
firm
5. services provided by the centra government, state government, union territory
or local authority to a business entity it exclude following services
a. renting of immovable property
b. services specified below
i. services by the department of posts by way of speed post, express parcel
post, life insurance
ii. services in relation to an aircraft or a vessel, inside or outside the
precincts of a port or an airport
iii. transport of goods or passengers
6. services provided by the centra government, state government, union territory
or local authority
7. services supplied by any person by way of transfer of development rights (TDR)
or floor space index(FSI) for construction of a project by promoter
8. long term lease of land (30 year or more) by any person against consideration in
the form of upfront amount and/or periodic rent for construction of a project by a
promoter
9. services supplied by a director of a company/ body corporate to the said
company/ body corporate
10. services supplied by an insurance agent to any person carrying on insurance
business
11. services supplied by a recovery agent to a banking company or financial
institution or a non-banking financial company
journal entry
recipient (buyer)
e.g. legal charge
1. legal charge account Dr
To party
2. CGST account Dr
SGST account Dr
To CGST RCM
To SGST RCM
Seller
Party account Dr
To legal service (income)
Not eligible ITC.
1. Motor vehicles and other conveyances and related services (insurance, servicing and
repair and maintenance)
2. Food & beverages, outdoor catering, health services and other services
3. Works contract services for construction of immovable property
4. Self-construction of immovable property
5. Inward supplies charged to tax under composition levy
6. Inward supplies received by a non-resident taxable person
7. Inward supplies used for personal consumption
8. Free samples, gifts, goods lost/stolen etc.
9. Tax paid in fraud cases, detention, confiscation etc.
Journal entry
1. Intra-state supply
a. Purchase or service received
Purchase Account Dr
CGST Account Dr
SGST Account Dr
To party account
b. Sales or service provided
Party Account Dr
To sales Account
To CGST Account
To SGST Account
2. Inter-state supply
a. Purchase or service received
Purchase Account Dr
IGST Account Dr
To party account
b. Sales or service provided
Party Account Dr
To sales Account
To IGST Account
Set off
1. Input IGST set off
Input IGST XXX
(-) output IGST (XXX)
XXX
If input IGST greater than output IGST
(-) output CGST (XXX)
XXX
If input IGST greater than output CGST
(-) output SGST (XXX)
XXX
2. Input CGST set off
Input CGST XXX
(-) output CST (XXX)
XXX
If input CGST greater than output CGST
(-) output IGST (XXX)
XXX
3. Input SGST set off
Input SGST XXX
(-) output SGST (XXX)
XXX
If input SGST greater than output SGST
(-) output IGST (XXX)
XXX
GST return forms
1. GSTR-1 return for outward supply
A. Person required to file GSTR-1
The details of outward suppliers are required to be furnished,
electronically, in form GSTR-1 for the month or quarter. Such details can be
furnished through the common portal, either direct or form a facilitation centre
notified by the commissioner.
Further, a nil GSTR-1 can be filed through an SMS using registered mobile
number of the taxpayer.
All registered person including casual registered person
• Input Service Distributor (ISD)
• Non-resident taxable person
• Composition taxpayer
• Person deducting tax at source
• Person collecting Tax at Source
• Supplier of Online Information and Database Access or Retrieval (OIDAR)
service located in non-taxable territory providing services to non-taxable
online recipient
B. Due date
Filed on or before the 10th day of the immediate succeeding month. In
other words, GSTR-1 of a month can be filed any time between 1st and
10th day of the succeeding month. It may be noted that GSTR-1 cannot be
filed during 11th day to 15th day of the succeeding the tax period.
C. content of GSTR-1
[Link] & other details
• GSTIN
• Legal name
• Trade name, if any
• Aggregate turnover in previous year
• Year and month
• HSN-wise summary of outward supplies
• Details of documents issued
[Link] of outward supplies
• B2B including UIN Holders
• B2C inter-state supplies where invoice value >₹2.5 lakh
• Consolidated details of other B2C supplies
• Zero rated and deemed exports
• Debit/ credit notes issued
• Nil rated/ exempted/ non-GST
• Amendments for prior period
• Advances received/ advances adjusted
C. Invoice-wise details all
• Inter-state and intra-state supplies made to registered persons
• Inter-state supplies made to unregistered persons with invoice value
exceeding ₹250000
D. State-wise Consolidated details of all
• intra-state supplies made to unregistered persons
• Inter-state supplies made to unregistered persons with invoice value upto
₹250000
E. Debit and credit notes
Issued during the month for invoices issued previously
2. GSTR-2 return for inward supply
Form and manner of ascertaining details of inward supplies- GSTR-2A and GSTR-2B
A. GSTR-2A
Is a system generated read only statement of inward supplies for a recipient. This
statement is updated on a real time basis.
B. GSTR-2B
An auto-drafted read only statement containing the details of eligible ITC- is made
available to the registered person (recipient) for every month. It is a static statement
and is available only once a month
The statement of GSTR-2B for every month shall be made available to the
registered person
• For the 1st and 2nd month of a quarter, a day after the due date of
furnishing of details of outward supplies for the said month
It consists of
• The details of outward supplies furnished by suppliers in the form of GSTR-1
• The details of integrated tax paid on import of goods or goods brought in the
DTA from SEZ unit/ developer on a bill of entry in the month.
3. GSTR-3B Electronic commerce operator
A monthly return for every registered person, other than an input service distributor or
a non-resident taxable person or a composition taxpayer, a person deducting tax at
source, a person collecting tax at source, a person collecting tax at source, i.e. an
electronic commerce operator and supplier of OIDAR services located in non-taxable
online recipient in such form and manner
due date 20th day of the month succeeding the relevant calendar month
GSTR-3B is a simple return that containing summary of outward supplies, inward
supplies liable to reverse charge, eligible ITC, payment of tax etc. Thus, GSTR-3B does
not require invoice-wise data of outward supplies.
GSTR-3B can be submitted electronically through the common portal, either
directly or through a facilitation centre notified by the commissioner. Further, a nil
GSTR-3B can be filed through an SMS using the registered mobile number of the
taxpayer.
Due date
GSTR-3B can be filed monthly or quarterly.
• Monthly 20th of the month succeeding the month for which return is
furnished
• Quarterly 22nd or 24th of the month succeeding the quarter for which
return is furnished in case of a taxpayer opting for QRMP scheme
Contents of GSTR-3B
1. Basic details
• GSTIN
• Legal name of the registered person
• Year and month/ quarter
2. Other details relating to supplies
• Summarised details of outward supplies and inward supplies
liable to reverse charge
• Summarised details of inter-state supplies made to unregistered
persons, composition taxable person and UIN holders
• eligible and ineligible ITC
• values of exempt, nil-rated and non-GST inward supplies
• payment of tax
• TDS/TCS credit
4. GSTR-4 return for composition supplier
A registered person paying tax under the composition supplier is required to file annual
return of GSTR-4.
GSTR-4 for a financial year or part of financial year should be filed electronically
through the common portal either directly or through a facilitation centre notified by
the commissioner.
Required to furnish a statement in the form of GST CMP-08 containing details of
payment of self-assessed tax, for every quarter.
Due date
GSTR-4 for a financial year should be furnished by 30th April of the
succeeding financial year.
GST CMP-08 should be furnished by 18th day of succeeding such quarter.
The inward supplies of composition supplier received from registered person filing
GSTR-1 will be auto populated in form GSTR-4A for viewing.
Contents of GSTR-4
1. Basic & other details
• GSTIN
• Legal name and trade name
• TDS/TCS credit received (table 7)
• Tax interest, late fee payable and paid (table 8)
• Refund claimed from electronic cash ledger (table 9)
2. Details regarding inward and outward supplies
• Invoice-wise details of all inward supplies (i.e., intra and inter-state supplies and
from registered and unregistered persons) including reverse charge supplies and
import of services (table 4).
• Summary of self-assessed liability as per GST CMP-08 (net of advances, credit &
debit notes and any other adjustments due to amendments etc.) (table 5).
• Tax rate wise details of outward supplies/ inward supplies attracting reverse
charge (net of advances, credit & debit notes and any other adjustments due to
amendments etc.) consolidated details of outward supplies (table 6)
5. GSTR-5 return for non-resident taxable persons
Non-Resident Taxable Person (NRTP) are those suppliers who do not have a business
established in India and have come for short period to make supplies in India. They
would normally import their products into India and make local supplies.
A registered NRTP is not required to file separately the statement of outward
supplies and applicable return for a normal taxpayer. A simplified monthly tax return
has been prescribed in form GSTR-5 for NRTP for every calendar month or part thereof.
Due date
Within 20 days after the end of the calendar month or within 7 days after the
last day of validity period of the registration, whichever is earlier
Other returns
6. First return (section 40)
When a person becomes liable to registration after his turnover crosses the
threshold limit. He may apply for registration within 30 days of so becoming
liable to registration and grant of registration certificate.\
contents
Details of outward supplies, after becoming liable to registration but
before grant of the certificate of registration
Details of outward supplies made in first tax period after grant of the
certificate of registration.
7. GSTR-9 annual return
all registered person are required to file an annual return. However, following
persons are not required to file the annual return.
• Casual taxable person
• Non-resident taxable person
• Input service distributors
• Persons authorized to deduct/ collect tax at source under section 51/52
and
• Person supplying OIDAR dervices from outside India to unregistered
persons in India.
Due date
31st December of the next financial year.
The annual return is to be filed electronically in form GSTR-9 through the
common portal.
Including composition scheme is required to file the annual return in GSTR-9A
8. GSTR-10 final return
Every registered person who is required to furnish return and whose registration
has been surrendered or cancelled is required to file a final return electronically in form
GSTR-10 through the common portal.
Time limit for furnishing final return
The final return has to be filed within 3 months of the
• Date of cancellation
or
• Date of order of cancellation
Whichever is later
9. GSTR-11 details of inward supplies of persons having UIN
A. When UIN is issued for claiming refund of taxes paid on inward
supplies
such person shall furnish the details of the inward supplies of taxable
goods and/ or services on which refund of taxes has been claimed, in form GSTR-
11, along with application for such refund claim.
B. When UIN is issued for purposes other than refund of taxes paid
such person shall furnish the details of inward supplies of taxable goods
and/ or services as may be required by the proper officer in form GSTR-11.