Introduction
Involuntary charges levied on individuals or businesses and enforced by a government agency— whether local, regional, or national — to finance government operations are called taxes. In economics, taxes are levied on whoever bears the tax burden, be it the taxing entity, like a corporation, or the end-users of the company's goods. In India Taxes are categorized into two forms:
1. Direct Taxes
From the name, we can understand that those taxes which are directly collected from individuals or body corporate are termed as direct taxes like Income tax.
2. Indirect taxes
From the name, it is cleared that those taxes which are collected indirectly from individuals and body corporate are termed as indirect tax like GST, Customs Duty, Excise duty, etc
Indirect Taxes
GST means goods and services tax is a form of indirect tax that has replaced other types of indirect taxes such as service tax, excise duty (not on all items), sales tax etc. GST has made indirect taxation much easier and simpler by eliminating the cascading effects of taxes. GST is regulated by the Goods and Service Tax Act, passed in Parliament on 29 March 2017 and came into force on 1 July 2017.
We have already seen a host of positive improvements in India's fiscal environment with the introduction of GST. Due to this new revised indirect tax, the numerous taxes that had been compulsory earlier are now obsolete. Not only that, GST makes sure that the slogan "One Nation, One Tax, One Market" is becoming our country's reality and not just a fantasy.
If business crosses the specified threshold then the business has to get register under GST.
*CBIC has notified the increase in threshold turnover from Rs 20 lakhs to Rs 40 lakhs. The notification will come into effect from 1st April 2019.
- Individuals who were registered under the Pre-GST laws (viz-a-viz Excise, VAT, Service Tax, etc.)
- Businesses that have a turnover of INR. 40 Lakhs and above (INR. 10 Lakhs for North-Eastern States, Himachal Pradesh, and Uttarakhand)
- Casual taxable person / Non-Resident taxable person
- Agents of a supplier
- Input service distributor
- Businesses/Individual required to pay tax under the reverse charge mechanism
- A person who does trade via an e-commerce aggregator
- An e-commerce aggregator
- Any person, other than a registered taxable person, who supplies online information and/or database access and/or retrieval services to a person in India from a place outside India.
Types of Return under GST
âž² GSTR-1
Through this return form, the taxpayer will report the details of all outward supplies of goods and services made or in other words sales transactions made during a tax period and also reporting debit or credit note issued.
âž² GSTR-2
Through this return, form entity will report about the inward supplies of goods and services that are purchases made during the tax period.
âž² GSTR-3B
It a monthly return form furnishing the summarized details of all outward supplies made, input tax credit claimed, tax liability ascertained and taxes paid.
âž² GST-4
This return is to be filed by taxpayers who have opted for composition scheme.
âž² GSTR-5
This return to be filed by non-resident foreign taxpayers, who are registered under GST and carry out business transactions in India.
âž² GSTR-6
This return to be filed by an Input Service Distributor (ISD)
âž² GSTR-7
This return to be filed by persons required to deduct TDS (Tax deducted at source) under GST.
âž² GSTR-9
This return to be filed by taxpayer registered under GST, this return will contain all the details of the outward supply made, inward supplies received during the relevant previous year under different tax heads.
On non-filing of return:
The late filing would result in late payment of the fee which for CGST & SGST will be INR 100 per day respectively, meaning that the fine will be 200 per day. Gone are charges of 25 rupees CGST & 25 Rupees SGST and IGST 50 rupees only, in case of NIL return late filling payments. And the balance of the hire is paid to the user by the department for rupees 5000/-per month
Returns and due dates
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Return Form
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Particulars
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Frequency
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Due Date
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GSTR-1
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Details of outward supplies of taxable goods and or services affected
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Monthly
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11th of next month
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GSTR-2 (suspended)
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Information of the inward supply of taxable goods and services which are covered by the input tax credit
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Monthly
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Every 20th of the next month
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GSTR-3B
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Simple Return in which overview of outbound supplies is reported along with input tax credit and tax payment is affected by taxpayer
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Monthly
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Every 20th of the next month
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GSTR-5
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Return filed by non-resident foreign taxable person
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Monthly
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Every 20th of next month
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GSTR-6
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Return for an input Service distributor
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Monthly
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13th of the next month
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GSTR-7
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Return for authorities deducting tax at source
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Monthly
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10th of next month
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GSTR-9
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Annual Return
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Yearly
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31st December*
*keeps on changing
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Custom Duty
Customs duty applies to the tax levied when shipped across international boundaries on the goods. The goal behind the levying of customs duties is to safeguard the economy, employment, environment, citizens, etc. of each nation by regulating the movement of goods, especially prohibited and restrictive goods, into and out of any country.
Each good has a predefined duty rate, which is calculated on the basis of various factors, including where such goods were obtained, where such goods were manufactured, and what such goods are made from. Also, whatever you first carry to India should be declared in compliance with the customs law. For example, you must report the goods purchased in a foreign country and any gifts that you purchase.
Classification of duty
Customs duties are levied almost uniformly on all products imported into a country. Which are classified into:
âž² Basic Customs Duty (BCD)
âž² Countervailing Duty (CVD)
âž² Additional Customs Duty or Special CVD Protection Duty,
âž² Custom Duty Cessation of Anti-dumping Duty
âž² Education Cess on Custom Duty
Computation of customs duty:
Customs duties are determined on a particular basis, or ad valorem. This is based on the value of the products, in other words. This value is calculated in compliance with the guidelines set out in the Guidelines of Customs Valuation (Determination of Value of Imported Goods), 2007. Where there are doubts as to the reality or accuracy of the value of the items, the valuation of such item shall be done by the following method:
Rule 4 & 5–Method for comparing the purchase value of equivalent or related products.
Rule 7–Method of deduction using the selling price of these goods in the importing country.
Rule 8–Method of measurement of value using costs relating to materials, manufacturing, and benefit in the producing country
Rule 9–Method of fallback based on previous methods with an element of higher flexibility.
Follow the Steps for paying your Duty
Step 1- Go to the e-payment ICEGATE portal and do the login.
Step 2- Provide your import-export code information
Step 3- click on e-payment button
Step 4- all the e-challans in your name will appear here
Step 5- choose Challan for which you wish to pay
Step 6- Make the payment and print your receipt