GST Compliance Checklist in India

GST Compliance Checklist in India

The Goods and Services Tax (GST) is an indirect tax system that has revolutionized the Indian tax structure. Implemented in July 2017, GST has brought about a significant transformation in the country's taxation landscape. To ensure smooth compliance with GST regulations, businesses need to adhere to certain guidelines and requirements. In this article, we will provide you with a comprehensive GST compliance checklist to help you navigate through the intricacies of GST compliance in India.

GST Registration

  1. Determine the threshold: Check whether your business meets the turnover threshold for GST registration, which is currently set at Rs. 40 lakhs for goods suppliers (Rs. 20 lakhs for specific states) and Rs. 20 lakhs for service providers.
  1. Apply for GSTIN: Register your business for GST by applying for a Goods and Services Tax Identification Number (GSTIN) through the GST portal.
  1. Verify GSTIN: Ensure that your GSTIN is valid and up to date by regularly verifying it on the GST portal.

Tax Invoice and Documentation

  1. Issue tax invoices: Issue proper tax invoices for all taxable supplies of goods or services, including the mandatory information such as GSTIN, invoice number, date, customer details, description of goods or services, and applicable taxes.
  1. Maintain proper records: Maintain accurate and organized records of all invoices, receipts, purchases, and expenses related to your business operations for at least 6 years.

HSN and SAC Codes

  1. Classify goods and services: Determine the appropriate Harmonized System of Nomenclature (HSN) and Service Accounting Code (SAC) for the goods or services you deal with, as per the GST regulations.
  1. Update HSN and SAC codes: Ensure that your invoices and returns include the correct HSN and SAC codes, as they play a crucial role in determining the tax liability and availing input tax credits.

GST Returns

  1. File returns on time: File your GST returns within the prescribed due dates, which vary based on your turnover and registration type (monthly, quarterly, or annually).
  1. Reconcile returns: Regularly reconcile the data furnished in your returns with the books of accounts to identify any discrepancies or errors.

Input Tax Credit (ITC)

  1. Eligibility for ITC: Ensure that you are eligible to claim Input Tax Credit by verifying that your suppliers have filed their GST returns and paid the applicable taxes.
  1. Reconcile ITC: Reconcile your purchase data with the GST returns filed by your suppliers to ensure the accuracy of your Input Tax Credit claims.

E-way Bill Compliance

  1. Generate e-way bills: Generate and carry e-way bills for the movement of goods worth more than Rs. 50,000, ensuring compliance with the e-way bill rules.
  1. Validity and updates: Verify the validity of e-way bills and make necessary updates (such as vehicle number changes) as per the guidelines.

Reverse Charge Mechanism (RCM)

  1. Identify RCM applicability: Determine whether you are liable to pay taxes under the Reverse Charge Mechanism for goods or services received from unregistered suppliers.
  1. Maintain RCM records: Maintain proper records of RCM transactions, including invoices and payment details.


GST compliance is vital for businesses operating in India to avoid penalties, legal complications, and disruptions in operations. By following this comprehensive GST compliance checklist, businesses can ensure smooth adherence to the GST regulations. Regularly updating and reviewing your compliance processes will help you stay on top of your GST obligations, fostering a transparent and efficient tax ecosystem in India.

 



 

Created & Posted by Pooja

Income Tax Expert at TAXAJ

 

TAXAJ is a consortium of CA, CS, Advocates & Professionals from specific fields to provide you a One Stop Solution for all your Business, Financial, Taxation & Legal Matters under One Roof. Some of them are: Launch Your Start-Up Company/Business, Trademark & Brand Registration, Digital Marketing, E-Stamp Paper Online, Closure of Business, Legal Services, Payroll Services, etc. For any further queries related to this or anything else visit TAXAJ

 

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