What is the definition of supply under GST?

• Under GST, “supply” includes all forms of supply of goods or services, such as sale, transfer, barter, exchange, license, rental, lease, or disposal, made for consideration in the course or furtherance of business. It also includes the import of services for a consideration whether or not in the course or furtherance of business.

Which taxes are subsumed under GST?

• GST has replaced several central and state taxes, including Central Excise Duty, Service Tax, VAT, Central Sales Tax, Luxury Tax, Entertainment Tax (except those levied by local bodies), Octroi, Entry Tax, and Purchase Tax.

What are the different types of GST returns and their due dates?

• GSTR-1: Monthly return for outward supplies, due by the 11th of the next month.
• GSTR-2: Auto-populated return for inward supplies.
• GSTR-3B: Monthly summary return of outward supplies and input tax credit, due by the 20th of the next month.

What is the difference between composite supply and mixed supply under GST?

• Composite Supply: A supply consisting of two or more goods/services, naturally bundled and supplied together, where the principal supply determines the tax rate.
• Mixed Supply: A combination of two or more goods/services offered for a single price, where each item can be supplied separately. The highest rate of GST among the bundled goods/services is applicable.

What are the different types of GST Acts in India?

• The four main types are Central GST Act (CGST), State GST Act (SGST), Integrated GST Act (IGST) for inter-state transactions, and Union Territory GST Act (UTGST).

How is Input Tax Credit (ITC) utilized under GST?

• ITC can be utilized as follows:
  • IGST can be set off against IGST, CGST, and SGST/UTGST in that order.
  • CGST can be set off against CGST and IGST.
  • SGST/UTGST can be set off against SGST/UTGST and IGST.

What is the interest rate for delayed payment of GST?

• The interest rate for delayed payment of GST is 18% per annum and must be calculated on the outstanding tax to be paid.

What are the conditions for claiming Input Tax Credit under GST?

• Conditions include possession of a tax invoice, receipt of goods/services, goods/services used for business purposes, and GST paid to the government by the supplier.

What is the difference between inter-state and intra-state supplies?

• Inter-state supply involves the movement of goods or services from one state to another, while intra-state supply occurs within the same state. GST rates and applicability differ for these supplies.

What is the Reverse Charge Mechanism (RCM) applicable to goods?

• RCM is applicable on specific goods and services as notified by the government. Examples include cashew nuts (not shelled or peeled), tobacco leaves, and silk yarn.

In which situations is Input Tax Credit (ITC) blocked under GST?

• ITC is blocked in cases such as motor vehicles for personal use, goods or services used for personal consumption, construction of immovable property (other than plant and machinery), and membership of a club, health, and fitness center.

Is salary covered under GST?

• No, salary is not covered under GST as it is considered a service by an employee to the employer in the course of employment, which is outside the purview of GST.

Is rent covered under GST?

• Yes, rent for commercial properties is covered under GST. However, residential renting for personal use is exempt from GST.

What are the registration limits under GST?

• Registration under GST is mandatory for businesses with an annual turnover exceeding ₹40 lakhs for goods and ₹20 lakhs for services. For special category states, these limits are ₹20 lakhs and ₹10 lakhs, respectively.

What are the journal entries for RCM?

• Under RCM, the receiver makes the entry: Debit Expense Account, Debit GST Input Credit, and Credit Cash/Bank (for payment to the government).

What are the e-way bill limits and conditions under GST?

• An e-way bill is required for the movement of goods exceeding the value of ₹50,000. Conditions include generating the bill before the commencement of the movement and carrying it during transit.

What are practical questions on the value of supply?

• These questions may include scenarios determining the transaction value of supply, including considerations for discounts, incentives, incidental expenses, and subsidies.

How is the ‘Time of Supply’ determined under GST?

• The ‘Time of Supply’ determines when GST becomes payable and varies for goods and services. It depends on factors like the date of invoice or payment, whichever is earlier.

What is the cascading effect in taxation?

• The cascading effect in taxation refers to the tax-on-tax phenomenon that existed before GST. For example, VAT being charged on a product already includes the cost of excise duty.

What are the pros and cons of GST?

• Pros: Removes cascading tax effect, higher threshold for registration, composition scheme for small businesses, improved logistics efficiency.
• Cons: Increased operational costs for GST compliance, higher tax burden for certain sectors, complexity for small traders.

How can CA Inter GST knowledge be applied in case studies?

• This involves applying theoretical GST knowledge to practical scenarios, such as determining tax liability, eligibility for ITC, and compliance requirements in various business situations.

What is the difference between zero-rated and exempt supplies in GST?

• Zero-rated supplies are taxable at a rate of 0%, allowing the supplier to claim ITC (e.g., exports, supplies to SEZs). Exempt supplies are not taxable, and no ITC can be claimed.

How does GST impact the pricing strategy of businesses?

• GST eliminates the cascading effect of taxes, potentially reducing costs. Businesses need to re-evaluate pricing strategies, considering the input tax credit and changes in tax incidence.

Explain the concept of ‘place of supply’ in GST.

• ‘Place of supply’ determines the location where goods/services are considered delivered and affects whether a transaction is interstate or intrastate, influencing the type of GST applied.

What documents are required for GST registration?

• Typically required documents include PAN card, proof of business registration, identity and address proof of promoters, business address proof, and bank account statements.

Can you explain the ‘reverse charge mechanism’ (RCM) with examples?

• RCM is where the recipient of goods or services pays GST instead of the supplier. An example is the GST on services provided by an advocate to a business entity.

What is the anti-profiteering measure in GST?

• The anti-profiteering measure ensures businesses pass on the benefit of reduced tax rates or increased input tax credit to consumers by reducing prices, preventing inflationary profit-taking.

Describe ‘invoice matching’ in GST.

• Invoice matching is the process where details of invoices uploaded by suppliers are matched with those of the recipients to validate input tax credit claims.

What is GSTN and its significance?

• GSTN (Goods and Services Tax Network) is a non-profit organization managing the entire IT system of the GST portal. It enables registration, tax filing, and maintaining tax details.

How is ‘Time of Supply’ determined for services under GST?

• The time of supply for services is the earliest of the following: the date of issue of the invoice, the date of receipt of payment, or the date of provision of service if the invoice is not issued within the prescribed period.