50 Most asked GST Interview Questions

GST

If you are an accountant or finance person handling all GST compliance, looking for a job. Then you should checkout these interview questions to prepare for your next job interview.

Q.1 What is GST (Goods and Services Tax)?

GST is a consumption-based tax that replaced various indirect taxes in India. It is levied on the supply of goods and services.

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Q.2 What is the objective of implementing GST?

The main objective of GST is to create a unified and simplified tax system, reduce tax cascading, and promote ease of doing business.

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Q.3 How is GST different from the previous tax regime?

GST replaces multiple indirect taxes, such as VAT, excise duty, and service tax, with a single tax, streamlining the taxation process.

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Q.4 What are the components of GST?

GST comprises Central GST (CGST), State GST (SGST), and Integrated GST (IGST) for interstate transactions.

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Q.5 What is the concept of 'Input Tax Credit' in GST?

Input Tax Credit (ITC) allows businesses to offset the tax they have paid on inputs against the tax they collect on outputs, reducing the tax liability.

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Q.6 How is GST categorized in terms of rates?

GST rates are categorized into four slabs: 5%, 12%, 18%, and 28%, with some goods and services attracting a nil rate or falling under the cess category.

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Q.7 Who is liable to pay GST?

The liability to pay GST typically falls on the supplier of goods or services, except in cases of reverse charge where the recipient is liable.

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Q.8 What is the threshold limit for GST registration?

The threshold limit for GST registration varies based on the type of business and location, with a higher limit for small businesses.

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Q.9 How is GST calculated on the transaction value?

GST is calculated as a percentage of the transaction value, with the applicable rate determined based on the type of goods or services.

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Q.10 What is the difference between CGST and SGST?

CGST is collected by the Central Government, while SGST is collected by the State Government on the same transaction to avoid double taxation.

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Q.11 What is IGST, and when is it applicable?

Integrated GST (IGST) is applicable on interstate transactions and is collected by the Central Government.

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Q.12 How is GST compliance different for businesses and individuals?

Businesses need to register, file returns, and pay GST regularly, while individuals generally encounter GST only when making purchases.

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Q.13 What are 'HSN codes' and 'SAC codes' in GST?

HSN (Harmonized System of Nomenclature) codes are used for goods, and SAC (Service Accounting Codes) are used for services to classify them under GST.

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Q.14 What is the GST Council, and what is its role?

The GST Council is a governing body responsible for making recommendations on GST rates, exemptions, and other policy matters to the Central and State Governments.

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Q.15 How does GST impact export and import transactions?

Exports are generally zero-rated, meaning no GST is levied, while imports are subject to IGST and customs duties.

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Q.16 What is the composition scheme under GST?

The composition scheme allows small businesses to pay GST at a fixed percentage of their turnover and file simplified returns.

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Q.17 What are the compliance requirements for GST-registered businesses?

GST-registered businesses must file monthly, quarterly, or annual returns, depending on their turnover, and maintain detailed records of transactions.

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Q.18 What is the role of GSTN (Goods and Services Tax Network)?

GSTN is the IT backbone of GST, responsible for providing the technology infrastructure for registration, return filing, and other GST-related processes.

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Q.19 How does GST impact the pricing of goods and services?

GST aims to reduce tax cascading and often results in a more competitive and efficient pricing structure for goods and services.

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Q.20 What are the penalties for non-compliance with GST regulations?

Penalties for non-compliance may include fines, interest on late payments, and cancellation of GST registration.

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Q.21 What is the 'Place of Supply' under GST?

The place of supply determines whether a transaction is interstate or intrastate and, consequently, the applicable GST (CGST/SGST or IGST).

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Q.22 How do GST rules apply to e-commerce businesses?

E-commerce businesses are required to collect and remit GST on behalf of sellers using their platform and comply with specific GST provisions for the sector.

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Q.23 What is the role of GST audit and assessment?

GST audits and assessments are conducted to verify the accuracy of GST returns filed by businesses and ensure compliance with GST laws.

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Q.24 How does GST impact the real estate sector?

GST affects the real estate sector by changing the taxation structure for under-construction properties, reducing tax cascading, and making input tax credit available.

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Q.25 How does GST impact the services sector?

GST has replaced the previous service tax regime, streamlining the taxation of services and allowing input tax credit for most service providers.

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Q.26 What is the mechanism for claiming Input Tax Credit (ITC) under GST?

Businesses can claim ITC by matching the details of their purchases with the corresponding sales reported by their suppliers in GST returns.

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Q.27 How does GST impact the pricing and availability of essential goods?

Essential goods are often subject to lower GST rates or are exempt to ensure affordability and accessibility to the masses.

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Q.28 What is the role of the GST ombudsman in dispute resolution?

The GST ombudsman provides an alternative mechanism for dispute resolution between taxpayers and tax authorities, promoting a quicker resolution of grievances.

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Q.29 How does GST impact the small-scale and informal sectors?

GST may initially pose challenges for small-scale and informal sectors due to compliance requirements, but it aims to bring them into the formal economy.

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Q.30 What is the anti-profiteering mechanism under GST?

The anti-profiteering mechanism ensures that businesses pass on the benefits of reduced tax rates and input tax credit to consumers by preventing unjustified price increases.

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Q.31 How does GST impact the healthcare sector?

GST affects the healthcare sector by changing the taxation structure for medical services, pharmaceuticals, and medical devices.

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Q.32 What are the GST compliance deadlines for businesses?

The compliance deadlines for GST depend on the type of return (monthly, quarterly, or annual) and the turnover of the business.

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Q.33 How do you calculate GST on a product or service?

GST is calculated by multiplying the taxable value of the product or service by the applicable GST rate (5%, 12%, 18%, or 28%).

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Q.34 What are the various GST return forms, and when are they filed?

GST return forms include GSTR-1 (sales), GSTR-2 (purchases), GSTR-3 (monthly return), GSTR-4 (composition scheme), and GSTR-9 (annual return), among others.

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Q.35 How does GST impact the transport and logistics sector?

GST simplifies the tax structure for transport and logistics, reducing inefficiencies at state borders and facilitating smoother movement of goods.

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Q.36 How is GST compliance verified by tax authorities?

Tax authorities may conduct audits, inspections, and scrutiny of GST returns and records to verify compliance and assess tax liability.

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Q.37 What is the role of the GST Appellate Tribunal?

The GST Appellate Tribunal provides an independent forum for businesses to appeal against GST-related decisions made by tax authorities.

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Q.38 How does GST impact the manufacturing sector?

GST simplifies the taxation of manufacturing by allowing input tax credit on raw materials and capital goods, reducing tax cascading.

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Q.39 What is the mechanism for resolving disputes related to GST?

Disputes related to GST are resolved through the GST Dispute Resolution Authority, Appellate Authority, and the courts, depending on the nature and complexity of the issue.

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Q.40 How does GST impact the restaurant and food industry?

GST affects restaurants by changing the taxation structure for dining in and takeaway services, with different rates for AC and non-AC establishments.

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Q.41 Where is the power to levy GST obtained from?

Article 246A of the Constitution, which was brought by the Constitution (101st Amendment) Act, 2016 granted the co-existent powers to both parliament and state legislatures to make laws with respect to GST. Nevertheless, -clause 2 of Article 246A read with Article 269A provides with the exclusive power to the Parliament to legislate with respect to inter-state trade or commerce.

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Q.42 What do you understand by the taxable event under GST?

Supply of goods and/or services. CGST & SGST will be levied on intra-state supplies while IGST will be levied on inter-state supplies. The charging sections are section 7 (1) of CGST/SGST Act and Section 4(1) of the IGST Act.

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Q.43 Is the reverse charge mechanism only applicable to services?

No, reverse charge are applicable to supplies of both services and goods.

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Q.44 Bring the implications in light, in case of purchase of goods from unregistered dealers?

The receiver of goods wont be able to get ITC. Furthermore, the recipients who are registered under composition schemes would be liable to pay tax under reverse charge.

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Q.45 Can composition scheme be availed if the taxable person effects inter-State supplies?

No, the composition scheme is applicable subject to the condition that the taxable person does not affect inter-state supplies.

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Q.46 Can the input tax credit be claimed by the taxable person under composition scheme?

No. A taxable person opting to pay tax under the composition scheme is out of the credit chain. He cannot take credit on his input supplies.

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Q.47 The customer who buys from a taxable person who is under the composition scheme can claim composition tax as input tax credit?

No, customer who buys goods from taxable person who is under composition scheme is in-eligible for composition input tax credit because a composition scheme supplier cannot issue a tax invoice

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Q.48 Can composition tax be collected from customers?

No, the taxable person under composition scheme isn't permitted to collect tax. It states that a composition scheme supplier cannot issue a tax invoice.

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Q.49 Give the threshold for opting to pay tax under the composition scheme?

The threshold for composition scheme is Rs. 50 Lakhs of aggregate turnover in financial year.

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Q.50 Give the penal consequences if a taxable person violates the condition and is in-eligible for payment of tax under the Composition scheme?

The taxable person who was in-eligible for the composition scheme would be liable to pay tax, interest and in addition he shall also be liable to a penalty equivalent to the amount of tax payable. (Section 8 (3) of the MGL).

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Q.51 When exemption from whole of tax collected on goods and/or services has been conceded unconditionally, can taxable person pay tax?

No, the taxable person presenting such goods or services shall not collect the tax on such goods or services.

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Q.52 What do you understand by the remission of tax/duty?

It means relieving the tax payer from the obligation to pay tax on goods when they are lost or destroyed due to any natural causes. Remission is subject to conditions prescribed under the law and rules made thereunder.

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Q.53 State whether remission is allowed under GST law?

Yes, brought section 11 of Model GST law permits remission of tax on supply of goods.

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Q.54 Does the model GST Law empower the competent government to exempt supplies from levying GST?

Yes. Under the Model GST Law's section 10, the Central or the State Government, on the recommendation of the GST council can exempt the supplies from the levy of GST either generally or subject to conditions.

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Q.55 What are the differences between the UPA’s GST and the NDA’s GST?

The primary differences:
Petroleum sector has been kept out of the extent of GST.
Liquor for human consumption is exempted, although tobacco and tobacco products will fall under GST.
There is a 1% tax on top of the GST for inter-state movement of goods and services.

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Q.56 What are the taxes that GST replaces?

Numerous different indirect taxes, have been replaced by GST:
Central Excise Duty
Service Tax
Countervailing Duty
Special Countervailing Duty
Value Added Tax (VAT)
Central Sales Tax (CST)
Octroi
Entertainment Tax
Entry Tax
Purchase Tax
Luxury Tax
Advertisement taxes
Taxes applicable to the lotteries.

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Q.57 What is Input GST?

GST on purchase is known as Input GST.

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Q.58 What is GST Payable?

Output GST- Input GST = GST Payable.

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Q.59 What is GST Credit?

If the input GST is more than the Output GST, then its the GST Credit. While the It calculated differently for different types of GST.

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Q.60 What is GST?

GST is a consumption-based indirect tax levied on the supply of goods and services.

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Q.61 When was GST implemented in India?

GST was implemented in India on July 1, 2017.

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Q.62 How does GST differ from the previous tax system?

GST replaced a complex system of multiple taxes with a single tax.

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Q.63 What are the different types of GST in India?

CGST, SGST, IGST, and UTGST are the types of GST in India.

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Q.64 What does CGST, SGST, IGST, and UTGST stand for?

CGST - Central Goods and Services Tax, SGST - State Goods and Services Tax, IGST - Integrated Goods and Services Tax, UTGST - Union Territory Goods and Services Tax.

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Q.65 What is the purpose of IGST?

IGST is for inter-state transactions and is collected by the central government.

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Q.66 What are the GST rates in India?

GST rates in India are 0%, 5%, 12%, 18%, and 28%, with some exceptions.

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Q.67 What is the composition scheme under GST?

It's a scheme for small businesses with a simplified tax structure.

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Q.68 Who is eligible for the composition scheme?

Businesses with an annual turnover up to Rs. 1.5 crores can opt for it.

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Q.69 What is GSTIN?

GSTIN (Goods and Services Tax Identification Number) is a unique 15-digit number assigned to each taxpayer.

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Q.70 What is the threshold limit for GST registration?

The threshold limit for GST registration is Rs. 20 lakhs (Rs. 10 lakhs for special category states).

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Q.71 What is Input Tax Credit (ITC)?

ITC allows taxpayers to claim credit for the GST paid on inputs and use it to offset their tax liability.

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Q.72 Can ITC be claimed for all goods and services?

ITC can be claimed for inputs used for business purposes, but not all goods and services.

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Q.73 What is the GST Council?

The GST Council is a constitutional body responsible for making decisions on GST rates, rules, and regulations.

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Q.74 What is the Reverse Charge Mechanism in GST?

Under this mechanism, the recipient of goods or services is liable to pay GST instead of the supplier.

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Q.75 What is the HSN code in GST?

HSN (Harmonized System of Nomenclature) code is used to classify goods for GST purposes.

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Q.76 What is the SAC code in GST?

SAC (Services Accounting Code) is used to classify services for GST purposes.

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Q.77 What is GST return?

A GST return is a document that contains details of income, expenses, and tax liability to be filed by a taxpayer.

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Q.78 How often should GST returns be filed?

GST returns should be filed monthly, quarterly, or annually, depending on the type of taxpayer.

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Q.79 What is GSTR-1?

GSTR-1 is a return for outward supplies and sales details.

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Q.80 What is GSTR-3B?

GSTR-3B is a simplified monthly return for summary details of sales and purchases.

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Q.81 What is GSTR-4?

GSTR-4 is a return for taxpayers under the composition scheme.

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Q.82 What is GSTR-9?

GSTR-9 is an annual return to be filed by regular taxpayers.

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Q.83 What is GSTR-9C?

GSTR-9C is a reconciliation statement to be filed along with GSTR-9 by taxpayers with a turnover above Rs. 2 crores.

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Q.84 What is the due date for GST return filing?

The due date for GST return filing varies based on the type of return and taxpayer.

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Q.85 What is the penalty for late GST return filing?

A late fee is charged for delayed GST return filing.

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Q.86 How would you differentiate between CGST, SGST and IGST?

1. CGST stands for Central Goods and Services Tax. CGST is charged on Local Sales within State which is collected by Central Government. CGST will replace taxes like Central Excise and Service tax

2. SGSTstands for State Goods and Services Tax which is charged on Local Sales within State. SGST is charged and collected by State Government. SGST will replace taxes like VAT, Luxury tax and Entertainment tax

3. IGST stands for Interstate Goods and Services Tax. IGST will be charged on Central Sales (Sales Outside State) which will be charged and collected by Central Government on Interstate Supply of Goods and Services. IGST will replace taxes like CST(Central Sales Tax).

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Q.87 Can GST be paid online?

Yes, GST can be paid online through the GST portal.

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Q.88 What do you understand by Output GST?

GST on sales is called Output GST also referred as GST Liability

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Q.89 What is the GST rate on gold?

The GST rate on gold is 3%.

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Q.90 State the procedure of Adjustment of IGST with CGST SGST Credit?

Output IGST can be adjusted with Input GST as per the given order -

Input IGST if any

Input CGST if any

Input SGST if any

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Q.91 Are exports subject to GST?

No, exports are considered as zero-rated supplies and are not subject to GST.

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Q.92 Name the different invoices under GST?

The different invoices under GST are -
1. For all types of Taxable Sales (Local or Central), normally a tax invoice is to be issued
2. Same Series number of invoice will start for local and central sales
3. Same series to be used for sale to registered and sale to unregistered person
4. For All types of taxable sales (Local or Central), generally a tax invoice is to be issued
5. Sale of exempted goods
6. Sale by composition dealer

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Q.93 What is E-way bill under GST?

An E-way bill is a document required for the movement of goods worth over Rs. 50,000.

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Q.94 What is the registration limit in GST?

The registration limit in GST is 20 Lacs. Such that if the aggregate turnover is greater than 20 lacs or likely to exceed 20 lacs, then Compulsory Registration (Limit is 10 lacs for North Eastern States).

The aggregate turnover includes all types of sales like -
1. Taxable Sales
2. Exempt Sales
3. Export Sales
4. Interstate Sales
5. Sales by Agent of Principal (Amount of taxes not to be included)

There If a person is making only exempt sales such that the amount of sales is more than 20 lacs, still compulsory registration in GST. Similarly if a person is making only export sales, then also Compulsory Registration in GST

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Q.95 What is the GST on services by educational institutions?

Educational services provided by educational institutions are generally exempt from GST.

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Q.96 Can you adjust CGST and SGST against each other?

CGST credit cannot be adjusted against SGST Payable. On the other hand SGST Credit cannot be adjusted CGST Payable. However, both can be adjusted against IGST Payable.
Such that the Sequence of Adjustment is -

Output IGST can be adjusted with Input GST in the following order

Input IGST if any
Input CGST if any
Input SGST if any

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Q.97 Is GST applicable on alcohol and petroleum products?

GST is not applicable to alcohol for human consumption and petroleum products, as they are subject to other taxes.

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Q.98 What are the disadvantages of GST?

Some of the disadvantages of GST are -
1. There are too many returns to be filed
2. Returns have become Complicated
3. Difficult to compute
4. IGST and not CGST on Interstate Sales
5. Last Period Tax to be Paid first
6. Last Period Tax to be Paid first

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Q.99 What is the anti-profiteering authority in GST?

The National Anti-Profiteering Authority ensures that businesses pass on the benefits of reduced GST rates to consumers.

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Q.100 What is the Place of Supply under GST?

Place of Supply determines whether a transaction is an intra-state or inter-state supply.

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Q.101 How is GST different from VAT?

GST is a comprehensive tax that subsumes multiple taxes, while VAT is a single-stage tax.

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Q.102 What is the impact of GST on inflation?

GST can have both inflationary and deflationary effects depending on the specific goods and services.