Integrating GST Compliance into Your Business Strategy

How Important It Is to Comply with the GST

• It eliminates the possibility of incurring expensive fines and legal problems by ensuring that your company works within the legal boundaries. 

• It helps to cultivate trust and credibility among many stakeholders, including consumers, suppliers, and government agencies. 

• Additionally, it helps your company to maximize its tax position by collecting input tax credits, which is a significant benefit.
• Tax audits, inquiries, and legal procedures are examples of company interruptions that may result from non-compliance. These can take time and money, slowing down your business.

• Compliance is a significant component of managing your company’s image. Businesses that follow tax rules are likelier to have customers and business partners who trust them.

• Advantage in the Market: Being compliant can give you a competitive advantage. It shows that you care about quality and efficiency, which can help you get more partners and buyers.

Easy GST Compliance Using Technology

• System of GSTN

• The GSPs and the ASPs

• Integration of the API

• Assistance to taxpayers

Effect on business efficiency

• Significantly cut the time and money taxpayers spent enforcing the law.
• Lessened the chances of rent-seeking and harassment
• They increased the number of people across the country who pay their taxes.
• More tax money is coming in even though tax rates are going down.
• Better general business output and efficiency
• The introduction of GST has made taxes more optional, which has increased competition and made businesses more successful.

• Registration compliance

• Tax Invoice compliance

• Return filing compliance

Compliance with GST Registration

• This rule applies to companies that sell things and had sales of more than ₹40 Lakh in the last financial year.
• Businesses that offer services and made more than ₹20 Lakhs in sales in the previous financial year are eligible.

Tax Invoice Compliance

• Number and date of the invoice
• Name of the customer
• Where to send and receive packages
• The customer and the taxpayer’s GSTIN number
• HSN code (Harmonized System of Nomenclature) code for the place of supply SAC code (Services Accounting Code) code
• Details about the item, such as its name, amount, measure, and total value
• Discounts and taxable value
• Tax rates and amounts
• Whether GST is due on a charged-back basis
• Signed by the seller

GST Return Compliance

• With the GSTR-1 form, you tell the government about your sales. After you file this report, you don’t have to pay any tax.

• GSTR-3B is a simple form that you can use to report your total GST obligations for a given tax period. It has to be self-declared every month and includes a summary of all the outgoing goods, input tax credits claimed, tax liabilities found, and taxes paid. Everyone who is registered for GST has to fill it out.

• People who are GST taxpayers and have an income of more than Rs. 2 Crores in the financial year file a GSTR-9 return every year. This return has information about the goods and services sold and bought during the previous year under different tax heads, as well as information about taxes paid and due. It makes up all of the GSTR-1, GSTR-2A, and GSTR-3B reports that were made monthly or quarterly during that year.

Applicability of e-invoices – GST Compliance

• For businesses with an annual turnover of Rs. 500 Crore or more, the e-invoice requirement went live on October 1, 2020. Later, the requirement was expanded to include businesses with an annual turnover of Rs—100 Crore or more.
• E-invoicing became required for companies with an income of Rs. 5 Crore or more on August 1, 2023. Smaller taxes will soon be able to do the same since e-invoicing has many benefits for them. 
• It doesn’t matter if you have an e-invoice or are just about to cross the barrier; knowing the basics will help you a lot.
• E-invoicing is a way to prove your identity electronically under GST. Businesses must register all of their B2B deals and export bills with the government system, called the Invoice Registration Portal (IRP).
• They must also get an Invoice Reference Number (IRN) for each invoice. Along with the IRN, the IRP will also make a digitally signed QR code that contains some of the invoice’s information and verify the filed invoice data.
• In other words, an e-invoice is a piece of paper that has a digitally signed QR code and an IRN attached to it. You can read a lot more about e-invoicing here: Electronic bill for GST.

Use of E-way Bills | GST Compliance

• If your business needs to move things, you need to know that you need to make an E-way Bill. It is necessary to create an E-way Bill whenever things worth more than Rs. 50,000 are moved.
• One of the main reasons for making an E-way Bill for moving goods between states and within states is to make sure that no one can avoid paying taxes.
• The E-way bill makes sure that moving things across the country is easy and quick, and it lowers the chances of bribes and fraud.
• With E-Invoicing, the government has made it easier to make the E-way Bill. Documents that are eligible can use IRP to make both IRN and E-way payments. This means the IRP system will either return the IRN, the E-way Bill Number, or both.

Finally, a few more reconciliations

• From a legal point of view, auto-populating information from e-invoices into GSTR-1 is just a convenience for taxes and does not mean that the numbers are correct.
• After looking at the data that was automatically filled in, filers need to ensure that the numbers and other information in each box are correct and appropriate, especially for GSTR-1. Then, they need to file the form according to the law.
• Even though GSTN fills in the information of your e-invoice automatically, it is still essential to ensure that they match up with your final GSTR 1 data.

When you want to report bills in GSTR 1, they should have an IRN. 

How CaptainBiz makes Integration easier

• Automatic Checks for Compliance

• Reporting in real-time

• Alerts and notifications for compliance

• Customized plans for compliance

• Easy Integration with current systems

Wrapping It UP

FAQs

• What is GST compliance?

• Why is GST compliance important?

• Why is it important for businesses to follow the GST rules?

• What happens if GST isn’t followed?

• How does CaptainBiz make it easier to comply with GST rules?

• How does using technology help with GST compliance?

• Who must register for GST?

• What is an e-way bill, and when do I need one?

• What is the penalty for not following the rules for GST billing?

• How can companies verify GST compliance?