Please enable JavaScript.
Coggle requires JavaScript to display documents.
Basics of Goods and Services Tax - Coggle Diagram
Basics of Goods and Services Tax
CONSTITUTIONAL FRAMEWORK OF GOODS & SERVICES TAX
Presently not taxable under GST
Central Excise Duty
Crude Petroleum
Aviation Turbine Fuel
Petrol
Natural Gas
High Speed Deisel
Outside the scope of GST
Alcoholic Liquor for human consumption and Electricity have been kept outside the ambit of GST
TAXABLE EVENT
CONCEPT OF SUPPLY
Supply should be of goods or services
only movable property is construed as goods
Barters and exchanges would be leviable to GST
Licences, leases, rentals with or without transfer of the right to use are considered as supply and leviable to GST
should be made for a consideration which could be in the form of money or otherwise
• Supply includes the flow of money from a 3rd party in lieu of OR on behalf of the recipient
• Deposit is not consideration unless specifically applied to by the supplier
• Supply should be made in the course of OR for the furtherance of business
• Any supply made for personal consumption OR in personal capacity does not attract GST
• Supply should be made by a taxable person
• Supply between both non-taxable parties is not leviable to GST
• Supply could be made to a non-taxable person also
• A taxable person is one who is registered OR is liable to be registered under the Act
Composite & Mixed Supply
Often goods or services or both together are supplied in combination and that’s when it may not be simple enough to distinguish supplies and identify them separately, as each of them may attract a different rate of tax but is sold as one package.
Composite Supply
Section 2(30) defines “composite supply” as a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both
Mixed Supply
Under Section 2(74) of CGST Act, 2017, “mixed supply” means two or more individual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply
LEVY & COLLECTION OF TAX
Rates (Goods)
Rates are broadly 0.25%, 3%, 5%, 12%, 18% and 28%
Rates (Services)
Rates are broadly 5%, 12%, 18% and 28% and that is split in to CGST and SGST
COMPOSITION SCHEME
who have an annual turnover of less than Rs. 1.5 crore in the preceding Financial Year (FY) are eligible to opt for this scheme i.e., Composition Levy. Notification No. 46/2017- Central Tax dated 13th October, 2017 was issued to substitute Notification No. 8/2017-Central Tax dated 27th June, 2017
The aggregate turnover would mean the sum of
i) Taxable supplies
ii) Exempt supplies
iii) Zero-rated supplies
iv) Inter-state supplies
Conditions & Restrictions
1) The supplier who opts for Composition Levy cannot raise tax invoice
2) Therefore, they need not collect any tax on supply
3) Hence, the recipient of such supplies can’t claim any Input Tax Credit (ITC) on supplies from such suppliers who have opted for Composition Levy
4) Similarly, even they themselves cannot claim any ITC on the inward taxable supplies
5) A person opting for the scheme shall mention on the invoices issued that he has opted for such scheme
6) He shall also mention “composition taxable person” on every notice board displayed at the place of business
7) The following cannot opt for composition levy:
a. Supplier of services (except food & restaurant services)
b. Supplier of exempt goods
c. Supplier of Inter-state supplies
d. E-commerce operators
e. Manufacturers of ice-cream, pan masala and tobacco
Composition Rules [Chapter II, CGST Rules, 2017]
REVERSE CHARGE MECHANISM
Liability to pay GST
a) Forward Charge Mechanism
b) Reverse Charge Mechanism
EXEMPTIONS UNDER GOODS & SERVICES TAX
Power to grant exemption from tax [Section 11 of CGST Act, 2017]
Distinctions between General Exemption and Specific (Special Order) Exemption
Exemptions under GST
a) Unbranded atta / besan / maida
b) Milk
c) Eggs
d) Curd
e) Fresh vegetables
f) Health care &
g) Education
h) Services by the Government (except Post Office, transport of goods / passengers etc.)
i) Services by RBI
j) Services by ESIC / EPFO
k) Services by IRDA, SEBI