types of gst returns

What is GST? Meaning & Types of GST Returns

February 06, 2023 • 6145 views
Author: Poonawalla Fincorp Team Category: Tax

In 2000, a committee was set up to draft the GST Law under the supervision of then Prime Minister of India, Atal Bihari Vajpayee. In 2004, the committee suggested that there should be an enhancement in the tax regime and tax structure. Later, after years of delay and discussion, in 2016, GST went live and was passed in both Rajya Sabha and Lok Sabha. After a year, GST (Goods and Services Tax) was implemented in India on 1st July 2017. 

What is GST?

Goods and Services Tax is an indirect tax levied on goods and services. With the introduction of GST, multiple indirect taxes were abolished such as VAT, service taxes, excise duty, etc. You can register under GST, if you fall under the following categories – a business with a turnover of more than ?40 Lakh in a financial year, individuals who are already registered under earlier law (i.e., excise, service tax, VAT, Octroi, Entertainment tax, tax on lottery, luxury tax, Purchase tax, etc.), non-resident individuals who pay tax, TDS Deductor, TCS Deductor, E-commerce aggregators, etc.

  • Manufacturer:  As a manufacturer, you have to pay GST on the purchase of raw materials and value addition to the product.
  • Service Provider: Under the GST scheme, a service provider is responsible for paying GST on both the purchase price of the products and the value added to it.
  • Retailer: As a retailer, you will be paying GST on the purchased product and added margin.
  • Consumer: The consumer is responsible to pay GST on the purchased product or service.

Advantage of GST

  • Uniform tax structure
  • Online GST process
  • Streamlining the process
  • Bring transparency

Types of GST

  • Interstate transactions – Interstate transactions occur when a transaction takes place between two states.
  • Intra-state transactions – The term intra-state transaction is used when the transactions take place within the state.

There are four types of GST in India:

  • SGST - State Goods and Services Tax – SGST is levied on the supply of products and services on intrastate transactions.
  • CGST- Central Goods and Services Tax – CGST is charged on the sale of services or products that occurs within a state.
  • IGST - Integrated Goods and Services Tax – Any inter-state transaction of products and services is categorized under IGST.
  • UGST- Union Territory Goods and Services Tax – When the transaction of services and products occurs between any of the union territories of the country is considered under UGST. Andaman and Nicobar Islands, Daman and Diu, Dadra and Nagar Haveli, Lakshadweep, and Chandigarh. UTGST is levied along with CGST.

How to Register GST?

You can register under GST, by following the below-mentioned steps:

  • Step 1: Visit the GST Portal and submit your GST application.
  • Step 2: After submission of the application, your ARN (Application Reference Number) will be generated instantly.

Types of GST Return

Under GST, there are 13 returns - GSTR-1, GSTR-3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR-7, GSTR-8, GSTR-9, GSTR-10, GSTR-11, CMP-08, and ITC-04

Return Form

Frequency

Who can file the GST Return?

GSTR-1

Monthly

GST-registered businesses

GSTR-3B

Monthly

GST-registered businesses

GSTR-4

Annually

Dealer under the composition scheme

GSTR-5

Monthly

Non-resident foreigners with businesses in India

GSTR-5A

Monthly

Non-resident

GSTR-6

Monthly

Input Service Distributors (ISD)

GSTR-7

Monthly

Businesses that deduct TDS

GSTR-8

Monthly

E-commerce operators

GSTR-9

Annually

GST-registered businesses

GSTR-9C

Annually

GST-registered businesses

GSTR-10

Monthly

Businesses with GST registration that was canceled or surrendered

GSTR-11

Monthly

Registered Business with a UIN

 

Documents Required for GST

  • For Individuals - PAN (Permanent Account Number) card, Address proof, Aadhaar card, bank account
  • For Company – PAN, bank details, address proof, article of association or Memorandum of association, certificate of incorporation

GST Rates Slabs

There are mainly four GST tax slabs in India – 5%, 12%, 18%, and 28%. GST slabs are created to keep food items and essential services in lower tax brackets and luxury items and services under higher brackets. There are more than 1,300 goods and 500 services that are divided into four tax slabs.

GST Calculation Formula

  • GST amount = Original price x GST Rate/100
  • Net price = Original price + GST amount

For example, you are a seller, selling a camera from Pune to Delhi for ?40,000 and the rate of GST applied on the camera is 18%

  • GST Amount (40,000 x 18)/100 = Rs.7,200
  • The net price will be 40,000 + 7,200 = Rs.47,200

Conclusion

This blog will surely help you understand the concept of GST in detail along with the concepts such as interstate, and intra-state transactions, how to apply for GST, types of GST, etc. In conclusion, with the introduction of GST, the taxation system is simplified helping businesses as well as the government.

FAQs

Q.1: What is GST in simple words?

GST in simple words means Goods and Services Tax. It is an indirect tax levied on goods and services.

Q.2: What are the 4 types of GST?

There are four types of GST in India namely SGST (State Goods and Services Tax), CGST (Central Goods and Services Tax), IGST (Integrated Goods and Services Tax), and UGST (Union Territory Goods and Services Tax).

Q.3: How is GST calculated?

GST can be calculated using the below-mentioned formula: 

  • GST amount = Original price x GST Rate/100
  • Net price = Original price + GST amount

Q.4: Who is the father of GST?

Atal Bihari Vajpayee is the father of GST.

Q.5: What is the current rate of GST?

There are four slabs of GST: 5% GST, 12% GST, 18% GST, and 28% GST.

Disclaimer

This blog provides informational content on tax benefits and rules based on the current provisions of the Income Tax Act of India, 1961. The interpretations are subject to change as per amendments made by the Government of India. Applicable rates of GST and cess will be as per the current regulations. Readers must seek professional advice for accurate and up-to-date information.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

Our team of expert writers and editors are passionate about providing authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

Trending Topics



Contact Us logo Quick Apply CIBIL Score logo Free CIBIL Whatsapp logo Connect on WhatsApp