What is GST?
Goods and Services Tax or GST is a single, destination-based indirect tax levied on the value added to goods and services at each stage of the supply chain. The main objective behind levying such a tax is to consolidate multiple indirect tax levies into a single tax.
The goods and services tax is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by business owners selling goods and services.
What is a GST bill?
A GST invoice is issued by a supplier or a seller to the recipient or the buyer of goods and services. Such a document indicates the names of the parties involved as well as the details of goods or services supplied under a given transaction like:
- Product name
- Quantity of goods or services sold
- Details of the supplier and the purchaser
- Terms of supply
- Date of supply
- Price of each good sold or service rendered
Advantages of GST
- GST eliminates the cascading effect of tax
GST is a comprehensive indirect tax that was designed to bring indirect taxation under one umbrella. More significantly, it will eliminate the Cascading tax effect that was evident earlier. Cascading tax effect can be best described as ‘Tax on Tax’.
- Higher threshold for registration
Earlier, in the VAT structure, any business with a turnover of more than Rs 5 lakh (in many states) was liable to pay VAT. Please note that this breaking point differed state-wise. Likewise, service tax was exempted for service providers with a turnover of less than Rs 10 lakh.
Under the GST regime, however, this threshold has been increased to Rs 20 lakh, which exempts numerous little traders and service providers.
- Composition scheme for private companies
Under GST, private companies (with a turnover of Rs 20 to 75 lakh) can benefit as it gives an alternative to lower taxes by using the Composition scheme. This move has cut down the tax and compliance burden on numerous independent ventures.
- It’s a simple and easy online procedure
The entire process of GST (from registration to documenting returns) is made online, and it is super simple. This has been beneficial for new businesses, especially, as they don’t have to run from column to post to get multiple registrations like VAT, excise, and service tax.
- The number of compliances is lesser
Earlier, there was VAT and service tax, each of which had its distinct returns and compliances. Under GST, however, there is only a unified return to be filed. Therefore, the number of returns to be filed has come down. There are around 11 returns under GST, out of which 4 are essential returns that apply to all taxable persons under GST. The fundamental GSTR-1 is physically populated, and GSTR-2 and GSTR-3 will be auto-populated.
- Defined treatment for E-commerce operators
Earlier to the GST regime, providing merchandise through the e-commerce sector was not defined. It had variable VAT laws. Every one of these differential treatments and complicated compliances has been removed under GST. Interestingly, GST has mapped out the provisions applicable to the e-commerce sector. Since these are applicable all over India, there should be no difficulty regarding the inter-state movement of products.
- Improved efficiency of logistics
Earlier, the logistics business in India needed to keep up multiple warehouses across states to stay away from the current CST and state entry taxes on inter-state movement. These warehouses were forced to operate below their ability, giving space for increased operating costs. Under GST, however, these restrictions on inter-state movement of merchandise have been lessened.
As an outcome of GST, warehouse operators and e-commerce aggregators players have shown interest in setting up their warehouses at strategic areas like Nagpur (which is the zero-mile city of India) instead of every other city on their delivery route.
Reduction in unnecessary logistics costs is already increasing benefits for businesses involved in the stockpile of products through transportation.
- The unorganised sector is regulated under GST
In the pre-GST era, it was often seen that certain industries in India, like development and textile, were largely unregulated and unorganised.
Under GST, however, there are provisions for online compliances and payments and profiting of info credit just when the supplier accepts the sum. This has acquired responsibility and regulation to these industries.
Why is GST invoicing important?
Various variables make the GST receipt amazingly important to the smoother recording of profits and diminished compromise.
- A GST receipt is definite proof of a substantial exchange. A substantial transaction is compulsory while recording GST returns since it contains all details, including data about the transacting parties, regardless of whether the transacting parties are enrolled under the GST structure, date of raising the receipt, details of products, administrations provided/received, and so on.
- A receipt is utilised to compare with exchanges referenced by different gatherings to check if the transaction details are exact. It is just when the receipt details are effectively coordinated that the taxpayer’s returns go through and the output tax risk is determined. What’s more, this will decide the measure of input tax credit that can be claimed by a taxpayer, which carries us to our next significant factor approving the requirement for invoicing under GST – profiting Input Tax Credit.
- The input tax break is the discount on the tax you have already paid on an exchange. This can only be claimed if the invoice meets all GST compliance necessities. On the off chance that the taxpayer doesn’t possess the confirmation of a legitimate exchange, the input tax credit will probably be turned around and added to the taxpayer’s output tax liability.
- Lastly, a GST receipt guarantees that citizens don’t miss their deadlines for filing returns. A GST receipt is a record of all exchanges that were done during a month. So, when a taxpayer files month to month returns, the GST receipt fills in as a record to decide the measures of GST a taxpayer should pay and the due date for the same.
Advantages of GST Invoicing software
- GST invoice: It permits taxpayers to produce a GST agreeable receipt according to their prerequisites and format, which incorporates every one of the obligatory things like GST No., HSN/SAC Code, GST Rate and all applicable taxes. It additionally empowers taxpayers to plan invoices and send payment reminders for outstanding payments.
- Check and match reports: Under GST filing, you need to make a wide range of sorts of reports and if there is some blunder, manually checking and coordinating these reports is a troublesome and tedious activity, yet the same thing with GST software, you can do it in minutes and catch a mistake without any problem. You can accommodate the mismatches of Invoices/Purchases/ITC/Returns.
- Get HSN/SAC codes: It is hard to look for significant HSN/SAC code manually. However, with GST software’s assistance, taxpayers can undoubtedly search for these codes based on their taxable goods and services.
- Auto tax Calculation: With GST software, taxpayers can undoubtedly figure their tax liability precisely with any mistakes. Without much of a stretch, you can find the applicable GST rates under CGST, SGST, UTGST, IGST and CESS. after presenting the details to the software, it consequently calculates and produces every one of the essential reports and invoices related to GST information.
How does myBillBook cater to your GST billing needs?
A software like myBillBook allows retailers to bill faster and produce various invoices much more efficiently than creating manual bills and invoice while also keeping data accuracy in check. Not just that, myBillBook invoicing software lets you access all your data through the web at any given time that you need it, for no extra charge!
- Billing software gets started on creating GST and non-GST inclusive invoices (as per your preference) within seconds. All you need is:
- GSTIN of both parties (if applicable for the party)
- Billing and shipping address of the party
- Consecutive invoice numbers
- Date of issuance
- HSN code of items
- CGST/SGST/IGST on items (as applicable)
- It projects a professional and sophisticated image with professional-grade paper bills.
- You receive 10+ exclusive reports that ensure smooth functioning of the business, including:
- Sales summary
- Profit and loss reports
- Party statements
- Stock summary
- GSTR-1 (Sales) [paid feature]
- GSTR-2 (Purchase) [paid feature]
- GSTR-3B [paid feature]
- Protect your data with daily automated backup and sync your mobile app with your desktop software. This way, you can access all your records on the go.