GST Basics & Structure
Understanding the GST framework is essential for every business operating in India.
What is GST?
Goods and Services Tax is a unified indirect tax replacing VAT, Service Tax, and Excise Duty. It follows a dual structure, CGST (Central) and SGST (State) for intra-state, and IGST for inter-state supplies.
GST Rate Slabs
GST applies at 0%, 5%, 12%, 18%, and 28% depending on the goods or services. Special rates apply to gold (3%), rough diamonds (0.25%), and composition dealers.
Registration Thresholds
Mandatory registration for businesses with aggregate turnover exceeding ₹40 lakhs (goods) or ₹20 lakhs (services). Special category states have a ₹10 lakh threshold.
Tax Invoice Requirements
Every registered supplier must issue a tax invoice with GSTIN, HSN/SAC code, tax amount, and place of supply. E-invoicing is mandatory for businesses with turnover above ₹5 crore.
Reverse Charge Mechanism
Under RCM, the recipient pays GST instead of the supplier. Applicable on specified goods/services like legal services, GTA, import of services, and purchases from unregistered dealers in certain cases.
Place of Supply Rules
Place of supply determines whether a transaction is intra-state or inter-state. Correct determination is critical for applying the right tax (CGST+SGST vs IGST) and avoiding disputes.
GST Return Filing Guide
Key returns every registered taxpayer must file, with due dates for FY 2025-26.
| Return | Who Files | Frequency | Due Date | Key Content |
|---|---|---|---|---|
| GSTR-1 | All regular taxpayers | Monthly / Quarterly | 11th / 13th of next month | Outward supply details, invoices |
| GSTR-3B | All regular taxpayers | Monthly | 20th of next month | Summary of supplies, ITC claim, tax payment |
| GSTR-9 | Regular taxpayers | Annual | 31st December | Annual consolidated return |
| GSTR-9C | Turnover > ₹5 crore | Annual | 31st December | Reconciliation statement (self-certified) |
| GSTR-4 | Composition dealers | Annual | 30th April | Annual summary of composition taxpayer |
| GSTR-7 | TDS deductors | Monthly | 10th of next month | TDS deducted under GST |
| GSTR-8 | E-commerce operators | Monthly | 10th of next month | TCS collected on supplies through platform |
ITC Rules & Restrictions
Input Tax Credit allows businesses to reduce their GST liability by the tax paid on purchases. Understanding eligibility and restrictions is critical to avoid scrutiny.
“Proper ITC reconciliation between GSTR-2B, purchase register, and GSTR-3B is the single most impactful compliance activity for any GST-registered business.”
V J Desai & Co. LLP, GST AdvisoryGST Regulatory Updates
E-Invoicing Threshold Reduced to ₹5 Crore
Businesses with aggregate turnover exceeding ₹5 crore must generate e-invoices through the IRP portal for all B2B transactions.
Key Compliance →Stricter ITC Matching Under GSTR-2B
GSTN now auto-populates GSTR-3B from GSTR-2B. Any mismatch between supplier filings and claimed ITC triggers system-generated notices.
Read More →GSTR-9 for FY 2024-25, Key Changes
Self-certification of GSTR-9C extended to all taxpayers above ₹5 crore. Key reconciliation points updated for FY 2024-25 filings.
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