Goods and Services Tax (GST) was introduced in India on July 1, 2017, with the aim of simplifying the taxation system and bringing about a uniform tax structure throughout the country. GST is a single tax on the supply of goods and services, right from the manufacturer to the end consumer, replacing multiple indirect taxes like excise duty, service tax, and value-added tax (VAT). In Jharkhand, the implementation of GST has brought about a significant change in the way businesses operate and maintain their accounting records.
GST Registration in Jharkhand
Any business or person who supplies goods and services worth more than Rs. 20 lakhs (Rs. 10 lakhs for special category states) in a financial year is required to register under GST. In Jharkhand, businesses can register for GST on the GST portal by providing their PAN, mobile number, and email address. Once registered, businesses are assigned a unique Goods and Services Tax Identification Number (GSTIN), which is a 15-digit alphanumeric number.
Invoicing under GST
Under GST, businesses are required to issue invoices for all supplies of goods and services. In Jharkhand, invoices must include the following details:
- Name, address, and GSTIN of the supplier
- Name, address, and GSTIN of the recipient
- Invoice number and date
- Description of goods and services
- HSN or SAC code of goods and services
- Quantity and unit of measurement
- Total value of supply, taxable value, and applicable tax rates (CGST, SGST/UTGST, and IGST)
- Signature of the supplier or authorized person
Businesses must maintain proper records of all invoices issued and received, including details of any advances received or paid.
Filing of GST Returns
Under GST, businesses are required to file monthly, quarterly, and annual returns, depending on their turnover. In Jharkhand, businesses with an annual turnover of less than Rs. 5 crore can opt to file quarterly returns, while those with a turnover of more than Rs. 5 crore must file monthly returns.
The following are the types of GST returns that businesses need to file:
- GSTR-1: Monthly or quarterly return that contains details of outward supplies made by the business.
- GSTR-2A: Auto-generated return that contains details of inward supplies received by the business.
- GSTR-3B: Monthly return that contains summary details of outward and inward supplies, as well as tax liability and input tax credit (ITC) availed by the business.
- GSTR-9: Annual return that contains a summary of all outward and inward supplies made by the business during the financial year.
In Jharkhand, businesses can file their GST returns on the GST portal, either manually or using software that is compatible with the GSTN.
GST Input Tax Credit (ITC)
One of the significant benefits of GST is the availability of input tax credit. Businesses can claim the credit for the tax paid on the purchases made for their business, such as raw materials, goods, or services. The ITC can be utilized to reduce the output tax liability of the business. In Jharkhand, businesses must maintain proper records of their purchases and the tax paid on them to claim the ITC.
GST Audits in Jharkhand
The GST law mandates regular audits of businesses to ensure compliance and prevent tax evasion. In Jharkhand, the GST authorities can conduct audits either through a desk review or a physical inspection of the business premises. The audit can cover various aspects of the business, such as registration, invoicing, ITC, and filing of returns. Businesses must maintain accurate records of their transactions and compliance with the GST law to avoid any issues during the audit.
Penalties for Non-Compliance
Non-compliance with the GST law can attract severe penalties and fines in Jharkhand. The authorities can impose a penalty of up to 10% of the tax amount for non-filing or late filing of returns. Failure to maintain proper records or issuance of incorrect invoices can attract a penalty of up to Rs. 25,000. Repeated non-compliance can lead to the cancellation of the business’s GST registration.
GST Seva Kendras in Jharkhand
The Government of Jharkhand has set up GST Seva Kendras in various locations to provide assistance to businesses regarding GST registration, filing of returns, and other related matters. These centers can provide guidance and support to businesses to ensure compliance with the GST law.
GST Composition Scheme
The GST law provides for a composition scheme for small businesses with an annual turnover of up to Rs. 1.5 crores. Under this scheme, businesses can pay a fixed percentage of their turnover as tax and avoid the hassle of maintaining detailed records of their transactions. In Jharkhand, businesses can opt for the composition scheme by filing the Form GST CMP-02 on the GST portal.
GST E-Invoicing
The GST law mandates the use of electronic invoicing for businesses with an annual turnover of more than Rs. 50 crores. In Jharkhand, businesses can generate electronic invoices using the GST portal or third-party software that is compatible with the GSTN. The e-invoices must comply with the prescribed format and contain a unique Invoice Reference Number (IRN) generated by the GST portal.
GST Refunds
Businesses can claim a refund of the tax paid on their purchases if they have excess input tax credit or if the tax paid on exports is higher than their output tax liability. In Jharkhand, businesses can file a refund application on the GST portal, along with the required documents, to claim the refund. The refund process can take up to 60 days, and businesses must ensure that they provide accurate information and comply with the prescribed guidelines to avoid any delays.
GST Council Meetings
The GST Council is a constitutional body that decides on various GST-related issues, such as tax rates, exemptions, and procedural changes. In Jharkhand, the state government is represented in the GST Council by the Finance Minister or any other representative appointed by the government. The decisions taken by the GST Council can impact businesses in Jharkhand, and businesses must keep themselves updated on the latest developments and changes in the GST law.
Conclusion
GST accounting in Jharkhand involves various aspects, such as registration, invoicing, filing of returns, audits, penalties, and refunds. The availability of the composition scheme, e-invoicing, and refunds can benefit small businesses and reduce their compliance burden. Businesses must comply with the GST law and keep themselves updated on the latest developments to avoid any penalties or fines. The GST Council meetings can impact businesses, and businesses must be aware of the decisions taken by the council.
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