Gst and its registration

GST (Goods and Services Tax)

Goods and Services Tax is referred to as GST. The majority of the goods and services that are consumed in a nation are subject to a value-added tax. GST is a comprehensive indirect tax that was introduced in India to replace a number of other indirect taxes imposed by the national and state governments.

India implemented GST on July 1st, 2017. It is a destination-based tax, which means it is imposed at the site where the products or services are consumed, or the final point of consumption. Depending on the kind of goods or services, different rates of GST are applied.

The GST system has streamlined India's tax code and made it simpler for businesses to adhere to tax laws. Also, it has assisted in removing the cascading impact of taxes, which prevents taxes from being imposed on other taxes. 

GST works by levying a tax on the value added at each stage of the supply chain.

Let me explain this with an example:

Suppose a manufacturer produces a product that costs Rs. 100. The manufacturer sells the product to a wholesaler for Rs. 120, and the wholesaler sells the product to a retailer for Rs. 150. Finally, the retailer sells the product to a consumer for Rs. 180. Under GST, the manufacturer would pay a tax on the value added by them, which is Rs. 20 (Rs. 120 - Rs. 100). The wholesaler would also pay a tax on the value added by them, which is Rs. 30 (Rs. 150 - Rs. 120). The retailer would pay a tax on the value added by them, which is Rs. 30 (Rs. 180 - Rs. 150). The consumer would pay a tax on the final value of the product, which is Rs. 180.

As a result, GST is charged at every level of the supply chain, and the tax paid at each stage can be applied as a credit towards the tax that must be paid at the stage after that. This contributes to removing the tax cascade effect that existed under the old tax system.

GST is collected by the government and distributed in accordance with a predetermined ratio to the Central government and the State governments. The tax rates, exemptions, and other components of GST are decided by the GST Council, a constitutional authority.

To get registered under GST in India, you need to follow the below steps:

• Go to the GST portal (www.gst.gov.in) and click on the "Services" tab.

• Click on the "Registration" tab and then select "New Registration".

• Choose "Taxpayer" and then select the appropriate state and district.

• Enter your business details, such as legal name of the business, PAN, email address, and mobile number.

• Enter the OTP received on your mobile and email.

• Enter the Temporary Reference Number (TRN) provided to you, if you have already applied for registration and saved the application.

• Fill in the rest of the application with the required details, such as the nature of the business, bank account details, and authorized signatory details.

• Upload the required documents, such as proof of address, PAN, and photographs of the authorized signatory.

• Submit the application and a verification code will be sent to your email and mobile.

• Verify the application by entering the verification code.

Once the application is submitted, a GST registration certificate will be issued to you. It usually takes around 3-5 working days for the registration process to be completed. After getting registered, you will be required to file regular GST returns and maintain proper records of your transactions.