Frequently Asked Question (FAQ) on GST

Frequently Asked Question (FAQ) on GST

These are some of the Frequently asked questions on GTS on different Social Media platforms. These questions will help you to know more about GST.

GST FAQ

Sr. No. FAQ on GST ANSWERS
REGISTRATION
1 Is value of inward supplies received on which RCM is payable included in aggregate turnover? According to Section 2(6) of CGST Act – The value of inward supplies on which tax is payable on reverse charge basis is not included in aggregate turnover.
2 What should be done in case a dealer migrated with wrong PAN as the status of firm was changed from proprietorship to partnership? In this case new registration would be required as partnership firm would have new PAN.
3 If the business of a taxable person is in many states, such that all supplies are below 10 Lakhs. Now he makes an Inter State supply from one state. Then will he be liable for registration? Anyone having aggregate turnover (all India) is more than 20 Lakhs or engaged in inter-State supplies is liable to register.
4 Can provisional GSTIN be used or is it necessary to get a new GSTIN? So can the provisional GSTIN be used till new one is issued? It s important to convert Provisional GSTIN into final GSTIN within 90 days. The time provisional GSTIN can be used till final GSTIN is issued. Where, PID & final GSTIN would be same.
5 Since liquor is out of GST law, so are the traders of country liquor required to migrate to GST from VAT? In case the person is completely involved in 100% supply of goods which are not liable under GST, then no registration is needed.
6 If I am not liable to tax according to u/s 23 of CGST implies NIL rated supply or abated value of supply? Here, Not liable to tax means supplies that are not leviable to tax under the CGST/SGST/IGST Act. You can also refer to explanation under Section 2(78) of the CGST Act.
7 Will a civil contractor has projects in various states requires separate registration for all states or only a single registration at state of head office will be sufficient? The supplier of service will have to register at the location from where he is supplying services.
8 Is turnover of supplies on which tax is payable by the recipient under reverse charge, included under aggregate turnover? The aggregate turnover of the supplier includes outward supplies on which tax is paid on reverse charge basis by the recipient.
9 Whether two registrations are required to be obtained, if there are two SEZ units within same state? Refer proviso to rule 8(1) of CGST Rules. SEZs under same PAN in a state require one registration.
10 Is an advocate providing interstate supply chargeable under Reverse Charge liable for registration? Suppliers who are making only those supplies on which recipient is liable to discharge GST under RCM are exempted from registration.
11 Under what situation is registration in other state required? Is registration required for giving service from Nasik to other state? In case the services are provided from Nasik then registration is required to be taken only in Maharashtra and IGST to be paid on inter-state supplies.
12 If I have already migrated under GST but want to register as ISD. Then can I apply now and what is the procedure? Completely separate and new registration is required for ISD. Note – New registrations are being opened from 0800 hrs. On June 25, 2017.
13 I have enrolled in GST but forgot to enter the SAC codes. What should be done in this case as the status shows migrated? SAC codes can also be filled while filing FORM REG-26 to convert provisional ID to final registration.
14 The ST number that I have is on individual name and I have migrated to GST. Now I wish to transfer this on my proprietorship firm. What should I do? All the conversion can be done while filling FORM REG-26 so as to convert provisional ID to final registration.
15 Will there be any GST or any other charges on rental income up to 20 lacs? GST is leviable only in case the aggregate turnover is more than 20 lacs. (Rs. 10 lacs in 11 special category States). To computer aggregate supplies turnover of all supplies made by you would be added.
16 Consider the case that if someone trades only 0% GST items (grains, pulses etc) then will is it necessary to register for GST, even if the turnover exceeds 20 lacs? Anyone dealing with 100% exempted supply is not liable to register irrespective if the turnover exceeds 20 lacs.
17 Will a person dealing exclusively in NIL rated or exempt goods/ services liable to register even if the turnover is greater than 20/10 Lakhs? No liability of registration in case you are dealing with 100% exempt supplies.
18 In case I have voluntarily registered even though my turnover is less than 20 Lakhs, will I be required to pay tax from the first supply I make post registration? Yes, you would be treated as a normal taxable person.
19 Is a separate GSTIN required by a registered person for deducting TDS (PAN and TAN are available)? Separate registration as tax deductor is required.
20 Whether separate registration is required for trading and manufacturing by same entity in one state? Only one registration per State for all activities.
21 If I am registered in Tamil Nadu and getting the service from unregistered dealer of Andhra Pradesh, should I take registration in Andhra Pradesh to discharge GST under RCM? Someone who makes inter-state taxable supply is required to take registration. Therefore in this case Andhra Pradesh dealer shall take registration and pay tax.
22 Is there any concept of area based exemption under GST? There will be no area based exemptions in GST.
23 For instance a company in Maharashtra holds only one event in Delhi, do they have to register in Delhi? Will paying IGST from Maharashtra be enough? If you provide any supply from Delhi then you need to take registration in Delhi. Else, registration at Mumbai is enough (IGST to be paid on supplies made from Mumbai to Delhi)
24 For how long can I wait to register in GST ? Any unregistered person has 30 days to complete its registration process and formalities from its date of liability to obtain registration.
25 In case I am not liable to register under GST but I was registered under Service tax? Then you can apply for cancellation of Provisional ID till 31st July 2017.
26 Will turnover of agents be added to that of the principal for registration? No, it will not be added
27 I am not an existing taxpayer and wish to newly register under GST, where can I do so? You would be able to apply for new registration at the GST Portal www.gst.gov.in from 0800 hrs. on 25-06-2017
Refund
28 In case, I have a pending export refund in Service Tax. What will happen? Refunds under earlier laws will be given under the respective laws only.
29 How do I ensure that my working capital is not blocked as refunds? Appropriate provisions have been made in the law by providing for grant of 90% refund on provisional basis within 7 days from filing of registration.
Cess
30 What will be the impact of GST on coal? Will the clean energy Cess on coal go or will it stay? Clean Environmental Cess on coal will be replaced by GST Compensation Cess.
Composition Scheme
31 If I am in composition scheme in GST and I purchased goods from an unregistered person, then will GST be paid to Government by me or not? Yes, you will be liable to pay tax on reverse charge basis for supplies from unregistered person.
Customs
32 What are the duties will be levied on import of goods? Customs duty and cess as applicable + IGST+ GST compensation cess. IGST and GST compensation cess shall be paid after adding all customs duty and customs cess to the value of imports.
Exports
33 According to the Present Procedures have Service Tax on Nepal, but no Goods Tax on Nepal. With GST, what tax will apply? The export procedure for Nepal would be same as that to other Countries.
34 Are there any exemptions for SEZ? How will a SEZ transaction happen in GST regime? Supplies to SEZs are zero-rated supplies as defined in Section 16 of IGST Act.
35 How would the sale and purchase of goods to and from SEZ be treated? Will it be an export or input? Supply to SEZs is zero rated supplies and supplies by SEZs are treated as imports.
36 What is the status of international export freight under GST as the same was exempt under POPS rules, as it is zero rated in most countries. POS for transport of goods determinable in terms of sec 12(8) or sect 13(8) of IGST Act, 2017, depending upon location of service provider/service receiver. Exports are treated as zero rated supplies.
37 Who will pay IGST, when goods are being imported from SEZ? Supply is treated as import and present procedure of payment of duty continues with the variation that IGST is levied in place of CVD.
38 Who will pay IGST when goods are procured from SEZ? Presently, importer is paying both BCD and CVD. In this case the supplies are treated as import and present procedure of payment continues with the variation that IGST is levied in place of CVD.
Input Tax Credit
39 Can SGST of Rajasthan charged by supplier on purchase from Rajasthan be utilized for payment of SGST in Madhya Pradesh? SGST of one State cannot be utilized for discharging of output tax liability of another State.
40 How can we use SGST credit for the payment of IGST on another state? SGST Credit can be used for payment of IGST liability under the same GSTIN only.
41 Can one State CGST be used to pay another state CGST? CGST and SGST Credit for a State can be utilized for payment of their respective CGST/SGST liabilities within that State for the same GSTIN only.
42 For the service supplied, Who should get the credit – state where it is billed or the state it is rendered? Tax will be collected in the State from which the supply is made. The supplier will collect IGST and the recipient will take IGST credit.
43 If a company is engaged in manufacturing of cement and power. Then which rule is referred for reversal of credit related to power business? Detailed rules for reversal of ITC when the supplier is providing exempted and non-exempted supplies have been provided in ITC Rules.
44 What is the process of reporting the credit/debit note from unregistered supplier to GSTN and ITC claimed in the same? The credit/debit notes on behalf of unregistered person will be given by registered person only. Further, GSTR2 provides for reporting of same by the recipient.
Invoice
45 If a shop sells taxable & exempt products to the same person (B2C), will it be required to issue tax invoice and bill of supply separately? In such a case the person can issue one tax invoice for the taxable invoice and also declare exempted supply in the same invoice.
46 Are registered dealers required to record Aadhaar/PAN while selling goods to unregistered dealers? There is no requirement to take Aadhaar / PAN details of the customer under the GST Act.
47 Since all expenses like freight/ transport/ packing are charged in Sales Invoice are taxable in GST? How to show it in the bill? All expenses will have to be included in the value and invoice needs to be issued accordingly. Please refer to Section 15 of CGST Act and Invoice Rules.
48 Can the construction material be moved to builders on delivery challan and thereby issue tax invoice post completion of activity? If the goods are meant to be supplied in the course of construction an invoice is necessary. If the goods are tools which are to be used for construction then delivery challan should be issued.
49 How will the following transaction be treated in GST (i) Delivered supply shortages in Transit. (ii) Customer gets less quantity and pays less. The supplier may issue credit note to the customers and adjust his liability.
50 Is it required to issue self Invoice for GST liability discharge on RCM or GST can be discharge through expenses booking voucher? For RCM liabilities tax invoice has to be issued on self.

Returns

51 What has to be done on tax paid on advance receipt in case the advance has to be refunded under any circumstance? Advance refunded can be adjusted in return.
52 Is it required by registered dealers to upload sale details of unregistered dealers also in GST? In general it is not required. But needed in case of inter-State supplies having invoice value of more than Rs 2.50 Lakhs.
53 How should we incorporate two supplies in return for Pharma with same HSN code of four digits but having different tax rates? Returns provide for furnishing rate wise details.

Supply

54 Is it required to discharge GST liability for all reverse charge having small amounts of Transaction or any amount limit is there? Rs. 5000/- per day exemption will be given in respect of supplies received from unregistered person. For supplies above this amount, a monthly consolidated bill can be raised.
55 What is treatment of promotional item given free to end consumers by FMCG companies? Tax will be charged only on the total consideration charged for such supply.
56 How to abide with 9(4) of CGST Act if POS is in another State of the unregistered supplier? A person making inter-state supply has to compulsorily obtain registration and therefore in such cases, section 9(4) will not come into play.
57 Under supply from unregistered dealer the purchaser have to pay GST on RCM basis. Will the stipend paid to intern also come under RCM? Stipend paid to interns will be employer-employee transactions. Hence, not liable for GST.
58 Is the salary by partnership firm to Partners as per Income Tax Act is liable under GST? Salary will not be liable for GST.
59 According to Sec 9(4) of CGST Act 2017. Under RCM, do I need to pay if I purchase stationary worth Rs.100 from an unregistered stationery shop? It has been decided that Rs. 5000/- per day exemption will be given in respect of supplies received from unregistered person.
60 How to treat promotional item given free to end consumers by FMCG companies? In case it is taxable, whether ITC is allowed? Tax is payable on consideration received for the supply.
61 Is GST leviable in case of returnable packing material like drums supplied with finished goods? GST will be levied on the value charged for the supply only.
62 How is the disposal of scrap treated in GST? If the disposal is in the course or furtherance of business purposes, it will be considered as a supply.
63 In case I am providing service to a customer in Maharashtra from MP. Such that the work is outsourced to a service provider in Maharashtra, what tax is required to be charged? Generally these will be two supplies where the supplier from MP will charge IGST from the recipient in Maharashtra. Whereas, the service provider in Maharashtra will charge IGST from the recipient in MP.
64 In case the address of buyer is Haryana and place of supply is same state of supplier that is Rajasthan, then what shall be applied IGST or CGST/SGST? If the place of supply and the location of the supplier are in the same State then it will be intra-State supply and CGST / SGST will be applicable.
65 Why is bifurcation of cash deposit as CGST-SGST-IGST required? Will cash held against a GSTIN, to be adjusted via return u/s 39? Three levies are under three different statutes and are required to be separately accounted for.
66 What is the difference in between ‘Nil rated’, ‘taxable at 0%’ and exempted goods and services? With reference to ITC. Exempt supply includes Nil rated (taxable at 0%) and non-Taxable supplies and no ITC is available for such supplies.
67 Is professional tax abolished in Maharashtra after introducing of GST? Professional tax is not a tax on supply of goods or services but on being in a profession. Professional tax not subsumed in GST.
68 Whill GST be charged under the following case – Employer provides bus service, meal coupon, telephone at residence, gives vehicle for official and personal use, uniform and shoes? Where the value of such supplies is in the nature of gifts, no GST will apply till value of such gifts exceeds Rs. 50000/- in a financial year.
69 The definition of composite supply and the description of same under Section 8 differ. Section 2(30) defines what will be considered as a composite supply. Whereas, Section 8 provides that in case of a composite supply, the treatment for tax rate etc. will be that of principal supply.
70 How will the slump sale be treated under GST? It will have the same treatment as normal supply.
71 Salary by Partnership firm to Partners as per Income Tax Act liable to GST, such that Partners are not employees of the firm? Salary will not be leviable of GST.

Transition

72 How can the transition credit be availed? Transition credit can be availed by filing the respective forms under Transition rules upto 30.09.2017.
73 Explain the area based exemption 50/2003 in UK & HP. Area based exemptions will not be continued under GST. It will be operated through the route of reimbursement as prescribed.
74 If I manufactured excisable goods. But unit availed the exception benefits 50/2003. What will happen to my dealers stock? The dealer will get deemed credit @ 40% / 60% of the CGST paid on supply of such goods in GST. If the goods are branded and greater than Rs. 25,000, full credit using CTD can be availed.
75 In case a trader buys from manufacturer who is not registered in excise as his turnover is below 1.5 crore. Can trader take ITC on stock up to 40%? Yes deemed credit will be available subject to satisfaction of other conditions as prescribed.
76 As a trader I have excise paid purchase invoice. Can I claim credit of full excise duty on closing stock of 1st July 2017? Full transition credit of such duty will be available on stock in hand in respect of which you have duty paying excise document subject to conditions under Section 140(3) of the CGST Act.
77 In case a trader purchases directly from manufacturer and all the documents showing excise, will he get full excise credit or 40% of CGST? Full transition credit of such duty will be available on stock in hand in respect of which you have duty paying excise document subject to conditions under Section 140(3) of the CGST Act.
78 In case FSD purchases directly from manufacturer and has value cum excise duty and excise duty is not separately shown will he get full credit? Full transition credit of such duty will be available on stock in hand in respect of which you have duty paying excise document subject to conditions under Section 140(3) of the CGST Act.
79 Will the full excise credit be available to traders who purchase directly from manufacturers and excise are separately shown in invoice? Full transition credit of such duty will be available on stock in hand in respect of which you have duty paying excise document subject to conditions under Section 140(3) of the CGST Act.
80 In June, 2017 – Vat returns no amount carried forward and held a stock of Rs. 50 lakhs. Then can we take credit of that stock or not? The supplier would be eligible to carry forward the closing balance of ITC from VAT return for June 17.
81 What is the impact of closing stock which has been already paid VAT on 1st July, 2017? The supplier would be eligible to carry forward ITC on such stock from VAT return for June 17.
82 In case VAT return refund claimed in June, 2017 with no balance credit in GST. In this case what is the position of submission of Form C? Refund claimed under existing law will be handled as per the provisions of the existing law. Form C to be submitted in terms of provision of Rule 1(1) of Transition Rules.
83 In case the service was provided on 28.06.2017 but the invoice will be raised on 05.07.2017. Whether we have to charge Service Tax or GST? If Point of Tax arises after appointed date, then GST will be chargeable on such supply.
84 Are we be eligible for credit on Capital Goods in transit and received post GST? No provision for such credit is there in GST law.
85 How to treat VAT balance pending on transition date? Balance VAT credit in the return will be transferred to new provisional ID as SGST Credit.
86 How to treat deemed export against Form H? Form H will not be there in GST.
87 Who shall bear the tax difference on closing stocks as on 30th June 2017? Whether the manufacturer/dealer or government? Closing ITC in VAT return will be allowed to be carry forward in GST.
88 How should we get input credit on stock in hand for spare parts billed from other state, excise, CST and entry tax paid? For all inputs with duty paying documents available respective CGST / SGST credit will be available. But credit of CST will not be available.
89 If a trader buys from manufacturer not registered in excise as his turnover is below 1.5 crore. then in such case can traders take ITC on stock up to 40% Deemed Credit will be available on stock in hand provided the conditions of section 140(3) read with Rule 1(4) of Transition Rules are satisfied.
90 Are we will be eligible for credit of duty paid on Capital Goods in transit and received post GST? No such provision in GST.
91 Can ITC of Swach Bharat Cess or Krishi Kalyan Cess be carried forward under GST? No, it cannot be carried forward
92 Whether Clean Energy CESS on imported Coal @ Rs. 400 PMT continues to be applicable in GST? No. Clean Energy Cess is being repealed. Coal, however, will be subject to compensation cess @ Rs 400/- per tonne.
93 Whether closing balance of edu cess and secondary higher education cess prior to 1st Mar 2015, can be carried forward in GST? No it will not be carried forward in GST as it is not covered by definition of “eligible duties and taxes” under Section 140 of the CGST Act.
94 How to treat 40℅ benefit on closing stock and whether 1 year limit is applicable? Deemed credit will be available for all stock procured within a 1 year period.
95 Transition credit available till what time? Where do I need to declare my input stock? The window to declare transition credit forms is three months from the appointed day. Please refer to transition rules for more details.

UTGST

96 Will there be GST in Andaman & Nicobar Islands as previously there was no VAT? Yes. For supplies within Andaman & Nicobar, CGST plus UTGST would be leviable.

Others

97 Is IGST leviable twice on high seas sales? First on high seas sales and second on custom clearance. IGST shall be levied only once on imports.
98 Is Krishi Mandi Fee (imposed in U.P.) be waived off in GST? GST does not concern such fee so GST does not affect it.
99 Is E-Way Bill applicable from 1st, July 2017 The present system for E-way Bill in States to continue, till the E-Way Bill procedures are finalized.
100 Whether there a sunset clause for Anti-Profiteering law? Yes, the sunset clause for Anti-profiteering Authority is of two years.

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