Is Your Software GST Ready?

Finally, GST has been rolled out. It is a big step forward for the country, and is one of the most complex GST rollouts worldwide.

While tax rationalisation and ease of doing business pan India have been touted as the main reasons for pushing this tax reform, the Government of India is taking this opportunity to bring businesses online and digital, by forcing tax filing to be done digitally, and asking for a level of detail in filing that almost forces businesses to use software for their transactions and billing.

Beauty and wellness businesses now need to evaluate their readiness level and act accordingly. Being blissfully ignorant of the complexity of the rollout can get businesses in trouble!

Key Implications of GST Rollout

Here are the key changes businesses have to brace themselves for - Tax rates have been rationalized. Products and services have been categorized into harmonized codes (SAC and HSN) and rates are set at this level. This means modifying the tax rates for products and services and assigning right codes.

Tax invoice sequence numbers have to be strictly adhered to. If your business takes partial payments, advance payments, offers redeemable instruments (like gift card, membership, packages), there are many complex scenarios that need to be handled as part of tax filing because each of them is treated different and thus separate returns must be filed for each.

Goods attract destination based tax. So while procuring goods, One has to be very methodical about tracking the taxes incident upon a particular delivery and collect detailed information from their vendors (including the reference numbers from their filing of tax invoice on GST portal), otherwise it will be hard to get input tax credits.