The Goods and Service Tax Act is a recently implemented law that is continually evolving. Given its profound impact on every aspect of business, it is crucial to comprehend the law and stay updated on all the latest amendments.

At Start Up Mates, we provide top-notch GST consultancy and advisory services. Our experienced team at Start Up Mates is adept at handling a range of GST issues, from implementation to classification and valuation. Trust us to navigate the complexities of GST with precision and expertise.

Our Range Of GST Consultancy And Advisory Services Includes:

GST Classification of Goods and Services

The HSN code, a 4 to 8 digit uniform code that classifies over 5000 products and is recognized worldwide, plays a crucial role in determining the GST tax slab for each good and service. Accurate classification is essential, as an incorrect one can have a significant impact on the taxability of the product. Determining the correct HSN code is of utmost importance. Furthermore, certain goods and services are eligible for tax exemptions under GST law, but these exemptions are subject to numerous rulings and case laws.

At Start Up Mates, we leverage our extensive experience in HSN classification to assist all our clients effectively. Trust us to ensure accurate classification and navigate the complexities of tax exemptions under the GST law.

GST Valuation

GST, being a consumption-based tax, is imposed on the final amount charged by vendors to their customers. However, the determination of the amount on which GST must be levied is subject to various valuation rules. Factors such as rebates and discounts extended by sellers to buyers may or may not be included in the GST valuation of goods and services. Incorrect valuation in each transaction can lead to issues such as interest charges, additional tax liability, and potential litigation.

At Start Up Mates, we specialize in the valuation of every business transaction, whether it’s significant real estate deals or the day-to-day sale of products. Trust us to ensure accurate and compliant GST valuation for your business.

Reverse Charge Assistance

Typically, the supplier of goods or services pays the tax on supply. Under the reverse charge mechanism, the recipient of goods or services becomes liable to pay the tax, i.e., the chargeability gets reversed.

The objective of shifting the burden of GST payments to the recipient is to widen the scope of levy of tax on various unorganized sectors, to exempt specific classes of suppliers, and to tax the import of services (since the supplier is based outside India).

Section 9(3), 9(4) and 9(5) of Central GST and State GST 2017 Acts govern the reverse charge scenarios for intrastate transactions. Also, sections 5(3), 5(4) and 5(5) of the Integrated GST Act 2017 govern the reverse charge scenarios for inter-state transactions.

Registration Rules Under RCM

Section 24 of the CGST Act, 2017 states that a person liable to pay GST under the reverse charge mechanism have to compulsorily register under GST. The threshold limits of Rs.20 lakh or Rs.40 lakh, as the case may be, will not apply to them.

Who Should Pay GST Under RCM?   

The recipient of goods/services should pay GST under RCM. However, as per the provisions of GST law, the person supplying the goods must mention in the tax invoice whether tax is payable under RCM.

The following points should be kept in mind while making GST payments under RCM:

  • The recipient of goods or services can avail of the ITC on the tax amount paid under RCM only if such goods or services are used for business or furtherance of business.
  • A composition dealer should pay tax at the normal rates and not the composition rates while discharging liability under RCM. Also, they are ineligible to claim any input tax credit of tax paid.
  • GST compensation cess can apply to the tax payable or paid under the RCM.

Under GST law, a supplier of goods and services is typically responsible for collecting and depositing GST with the authorities. However, in specific cases, such as the import of goods, GST has to be paid by the recipient. Identifying supplies falling under the purview of the reverse charge mechanism is crucial, as failure to do so can lead to non-compliance and legal issues for GST-registered individuals.

Input Tax Credit (ITC) Under RCM

A supplier cannot take the GST paid under the RCM as ITC. The recipient can avail of ITC on GST amount paid under RCM on receipt of goods or services, only if such goods or services are used or will be used for business purposes.

The recipient cannot use the ITC to pay output GST on goods or services under reverse charge and should be paid in cash only.

What is Self Invoicing?   

Self-invoicing is to be done when purchased from an unregistered supplier, and such purchase of goods or services falls under reverse charge. This is because your supplier cannot issue a GST-compliant invoice to you, and thus you become liable to pay taxes on their behalf. Hence, self-invoicing, in this case, becomes necessary.

Also, section 31(3)(g) states that a recipient who is liable to pay tax under section 9(3) or 9(4) shall issue a payment voucher at the time of making payment to the supplier.

At Start Up Mates, our GST advisory services ensure a thorough review of each business transaction by our experts to identify exceptional transactions that may be liable for reverse charge. Trust us to provide accurate guidance on your GST obligations.

Determination of Place and Time of Supply

Determining the place and time of supply is a critical aspect of the GST process. The place of supply specifies the nature of the transaction, distinguishing between inter-state and intra-state transactions. Conversely, the time of supply establishes when the supplier becomes liable to pay GST. This task can be challenging due to the various provisions in the law for determining the place and time of supply.
At Start Up Mates, we assist you in accurately determining and identifying the nature of these transactions, ensuring that you remain fully GST-compliant in all respects. Count on us for expert guidance on navigating the complexities of place and time of supply under GST.