Question 1

1 - I am a startup and can/should open GST?

Accepted Answer

GSTIN, known as GST Identification Number, is assigned to every GST registered person.Before GST was implemented, all dealers registered under the state VAT law were assigned a unique TIN number by the respective state tax authorities. Similarly, service providers were assigned a service tax registration number by the Central Board of Indirect taxes and Custom (CBIC).
 
Under the GST regime, all registered taxpayers are consolidated into one single platform for compliance and administration purposes and are assigned registration under a single authority. 
 
Every business operating in a state or Union territory will be assigned a unique Goods and Services Tax Identification Number, popularly known as GSTIN.
 
Verification of GSTIN can be done on the ClearTax GST Search Tool.
 
Structure of GSTIN
Each taxpayer is assigned a state-wise PAN-based 15-digit Goods and Services Taxpayer Identification Number (GSTIN)

Question 2

1.1 -  Input Tax Credit – ITC

Accepted Answer

One of the fundamental features of GST is the seamless flow of input credit across the chain (from the manufacture of goods till it is consumed) and across the country.ITC can be claimed only for business purposes. ITC will not be available for goods or services exclusively used for: a. Personal use b. Exempt supplies c. Supplies for which ITC is specifically not available

Question 3

1.2  - Who can claim ITC?

Accepted Answer

ITC can be claimed by a person registered under GST only if he fulfills ALL the conditions as prescribed.
a. The dealer should be in possession of tax invoice
b. The said goods/services have been received
c. Returns have been filed.
d. The tax charged has been paid to the government by the supplier.
e. When goods are received in installments ITC can be claimed only when the last lot is received.
f. No ITC will be allowed if depreciation has been claimed on tax component of a capital good
 
A person registered under composition scheme in GST cannot claim ITC.
Reconciliation of ITC,Reversal of Input Tax Credit,How to claim ITC?
 
Contact us to know more

Question 4

2 - ABOUT INCOME TAX

Accepted Answer

Income tax is levied on the income earned by all the individuals, HUF, partnership firms , LLPs and Corporates as per the Income tax Act of India. In the case of individuals, tax is levied as per the slab system if their income is above the minimum threshold limit (known as basic exemption limit ).

Question 5

2.1 - What is an income tax slab ?

Accepted Answer

Indian Income tax levies tax on individual taxpayers on the basis of a slab system. Slab system means different tax rates are prescribed for different ranges of income. It means the tax rates keep increasing with an increase in the income of the taxpayer. This type of taxation enables progressive and fair tax systems in the country. Such income tax slabs tend to undergo a change during every budget.These slab rates are different for different categories of taxpayers. Income tax has classified three categories of “individual “taxpayers such as:
Individuals (aged less than of 60 years) including residents and non-residents
Resident Senior citizens (60 to 80 years of age)
Resident Super senior citizens (aged more than 80 years)

Question 6

2.2 - Income Tax Slab Rates for FY 20-21 (AY 2021-22 )

Accepted Answer

Income tax slab rate for FY 2020-21 (AY 2021-22), New Tax regime

The basic exemption limit for an individual depends on his/her age as well as his/her residential status.
Individual taxpayers with net taxable income of up to Rs 5 lakh will continue to pay zero tax in both the tax regimes.
 
In this new regime, taxpayers has an option to choose either :
To pay income tax at lower rates as per New Tax regime on the condition that they forgo certain permissible exemptions and deductions available under income tax, Or
To continue to pay taxes under the existing tax rates.The assessee can avail rebates and exemptions by staying in the old regime and paying tax at the existing higher rate.

Question 7

3 - ECOMMERCE

Accepted Answer

Section 194O – TDS on Payments Made to e-commerce Participants
Section 194O has been introduced in the Union Budget 2020. According to Section 194O, an e-Commerce operator is required to deduct TDS for facilitating any sale of goods or providing services through an e-Commerce participant. TDS on e-commerce operators under section 194-O is applicable from 1 October 2020.

Question 8

3.1 -  Who are e-Commerce operators and participants?

Accepted Answer

E-Commerce Operator
An e-Commerce operator is a person who owns, operates, or manages a digital/electronic facility for the sale of goods and services. He is responsible for making payments to the e-Commerce participant on such sales.
 
E-Commerce Participant
An e-Commerce participant is a person who sells goods, services, or both through an electronic facility provided by an e-Commerce operator. He must be a resident of India.

Question 9

3.2 - Scope of Section 194O

Accepted Answer

E-Commerce operators should deduct TDS @1% at the time of credit of the amount of sale of goods, services, or both to the account of an e-commerce participant or at the time of making payment to an e-Commerce participant by any other mode, whichever is earlier.

FAQs

1 - I am a startup and can/should open GST?

1.1 - Input Tax Credit – ITC

1.2 - Who can claim ITC?

2 - ABOUT INCOME TAX

2.1 - What is an income tax slab ?

2.2 - Income Tax Slab Rates for FY 20-21 (AY 2021-22 )

3 - ECOMMERCE

3.1 - Who are e-Commerce operators and participants?

3.2 - Scope of Section 194O