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Wednesday, June 28, 2017

FAQs on GST - Part 3



This is a continuation of FAQs on GST Part 1 and Part 2


RETURNS

51. What would be done on tax paid on advance receipt if advance has to be refunded in any circumstance?
Ans. Advance refunded can be adjusted in return.

52. Do registered dealers have to upload sale details of unregistered dealers also in GST?
Ans. Generally not. But required in case of inter-State supplies having invoice value of more than Rs 2.50 lakh.

53. How to incorporate two supplies in return for pharma with same HSN code of four digits but having different tax rates?
Ans. Returns provide for furnishing rate wise details.

SUPPLY

54. Should we discharge GST liability for all reverse charge having small amounts of Transaction or any amount limit is there?
Ans. It has been decided that Rs 5,000 per day exemption will be given in respect of supplies received from unregistered person. For supplies above this amount, a monthly consolidated bill can be raised.

55. What is treatment of promotional item given free to end consumers by FMCG companies?
Ans. Tax will be charged only on the total consideration charged for such supply.

56. How to comply with 9(4) of CGST Act if POS is in another state of the unregistered supplier?
Ans. Any person making inter-state supply has to compulsorily obtain registration and therefore in such cases, section 9(4) will not come into play.

57. Under supply from unregistered dealer the purchaser have to pay GST on RCM basis.so whether stipend paid to intern will also come under RCM?
Ans. Stipend paid to interns will be employer-employee transactions. Hence, not liable for GST.

58. Salary by partnership firm to Partners as per Income Tax Act liable to GST?
Ans. Salary will not be liable for GST.

59. Sec 9(4) of CGST Act 2017. Do I need to pay under RCM if I purchase stationary worth Rs.100 from an unregistered stationery shop?
Ans. It has been decided that Rs 5,000 per day exemption will be given in respect of supplies received from unregistered person.

60. What is the treatment of promotional item given free to end consumers by FMCG companies? If taxable, whether ITC is allowed?
Ans. Tax is payable on consideration received for the supply.

61. Whether GST will be leviable in case of returnable packing material like drums supplied with finished goods?
Ans. GST will be levied on the value charged for the supply only.

62. How will disposal of scrap be treated in GST?
Ans. If the disposal is in the course or furtherance of business purposes, it will be considered as a supply.

63. I am from MP and providing service to a customer in Maharashtra. I outsource the work to a service provider in Maharashtra, what tax i need to charge?
Ans. Generally these will be two supplies where the supplier from MP will charge IGST from the recipient in Maharashtra. Whereas, the service provider in Maharashtra will charge IGST from the recipient in MP.

64. If address of buyer is Punjab and place of supply is same state of supplier (Rajasthan), then IGST will apply or CGST/SGST?
Ans. If the place of supply and the location of the supplier are in the same state then it will be intra-state supply and CGST / SGST will be applicable.

65. Why is bifurcation of cash deposit as CGST-SGST-IGST required? Is cash held against a GSTIN, to be adjusted via return u/s 39?
Ans. Three levies are under three different statutes and are required to be separately accounted for.

66. What is the difference in between 'Nil rated', 'taxable at 0 per cent' and exempted goods and services?
Ans. Especially in relation with ITC exempt supply includes Nil rated (taxable at zero per cent) and non-taxable supplies and no ITC is available for such supplies.

67. Will professional tax will be abolished in Maharashtra after introducing of GST?
Ans. Professional tax is not a tax on supply of goods or services but on being in a profession. Professional tax not subsumed in GST.

68. Employer provides bus service, meal coupon, telephone at residence, gives vehicle for official and personal use, uniform and shoes, any GST?
Ans. Where the value of such supplies is in the nature of gifts, no GST will apply till value of such gifts exceeds Rs 50,000 in a financial year.

69. The definition of composite supply and the description of same under Section 8 differ. Please explain consequences.
Ans. Section 2(30) defines what will be considered as a composite supply. Whereas, Section 8 provides that in case of a composite supply, the treatment for tax rate etc. will be that of principal supply.

70. Whether slump sale will attract GST. If yes then under which Section?
Ans. It will have the same treatment as normal supply.

71. Salary by Partnership firm to Partners as per Income Tax Act liable to GST?
Ans. Partners are not employees of the firm. Salary will not be leviable of GST.

TRANSITION

72. How do I avail transition credit?
Ans. Transition credit can be availed by filing the respective forms under transition rules upto September 30, 2017.

73. Please provide the clarity on area based exemption 50/2003 in UK and HP.
Ans. Area based exemptions will not be continued under GST. It will be operated through the route of reimbursement as prescribed.

74. We manufactured excisable goods. But unit availed the exception benefits 50/2003. What about my dealers stock?
Ans. The dealer will get deemed credit at the rate of 40 per cent / 60 per cent of the CGST paid on supply of such goods in GST. If the goods are branded and greater than Rs 25,000, full credit using CTD can be availed.

75. A trader buys from manufacturer not registered in excise as his turnover is below 1.5cr. Then in such case can trader take ITC on stock up to 40 per cent?

Ans. Yes, deemed credit will be available subject to satisfaction of other conditions as prescribed.

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