watch_later 31/01/18

SIR, iam a gst practitioner(startup), dealing with the accounts of my clients who are having hardware shops, ladies corners etc...The doubt is, on what they have pay the gst 

whether on the purchase they made in the month

or on the sale they made for the month

or on the profit they earned for that month???

2 Responses | Latest response: 01/02/18 | Sort by Likes(thumb_up) Recent | GST Reply
watch_later 01/02/18

GST will be charged on Sale amount

watch_later 31/01/18

GST is charged on value of goods/services supplied.

So, the charging is on value of goods and not on profit they make.

Again, if you clients are registered under composition levy, then they need to pay tax on sales they make in the period.

For example, currently the tax rate is 1% under composition scheme. .5% CGST and .5% SGST.

If you client has made sale of Rs. 1,00,000 then they need to pay Rs. 1,000 as tax. (500 CGST and 500 SGST).

If your clients are registered under normal scheme then they have to charge GST on invoice value. They will be eligible for Input credit benefit.

For example, they purchase items worth 80000 and paid GST Rs. 14,400 and made sales for Rs. 1,00,000 and collected GST Rs. 18,000 then they need to pay difference between input and output tax.

In this case GST will be paid Rs. 3,600 (18,000-14,400).


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