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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Sanjiv Kumar Enlightened Chartered Accountant

    When a business changes its legal structure—from a proprietorship to a partnership—the underlying legal entity also changes. Since GST registration is issued to a specific legal entity, the GST number linked to your proprietorship cannot be transferred to the new partnership. What This Means: New LeRead more

    When a business changes its legal structure—from a proprietorship to a partnership—the underlying legal entity also changes. Since GST registration is issued to a specific legal entity, the GST number linked to your proprietorship cannot be transferred to the new partnership.

    What This Means:

    • New Legal Entity:
      A proprietorship is treated as an extension of the owner, while a partnership is a distinct legal entity with its own identity.

    • New GST Registration Required:
      Since the legal entity has changed, you must cancel your existing GST registration for the proprietorship and apply for a new GST registration in the name of the partnership.

    • Compliance:
      It’s important to complete the new registration process to ensure continued compliance with GST laws and avoid any disruptions in your business operations.

    Final Takeaway:

    No, you cannot use the same GST number when transitioning from a proprietorship to a partnership. A new GST registration is mandatory for the new partnership entity.

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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Sanjiv Kumar Enlightened Chartered Accountant

    No, when calculating aggregate turnover under GST, you do not include the value of inward supplies on which the Reverse Charge Mechanism (RCM) is payable. Reference to the Law: Section 2(6) of the CGST Act, 2017 defines “aggregate turnover” as the aggregate value of all taxable supplies, exempt suppRead more

    No, when calculating aggregate turnover under GST, you do not include the value of inward supplies on which the Reverse Charge Mechanism (RCM) is payable.

    Reference to the Law:

    • Section 2(6) of the CGST Act, 2017 defines “aggregate turnover” as the aggregate value of all taxable supplies, exempt supplies, and exports made by a person in the course or furtherance of business.
    • Inward supplies under RCM are not included because they represent supplies received (where the recipient is liable to pay tax) and not supplies made by you.

    Why This Matters:

    • Accurate Calculation:
      The purpose of calculating aggregate turnover is to determine GST registration thresholds and compliance requirements based on your own business supplies. Including inward supplies would inflate your turnover incorrectly.

    • Statutory Clarity:
      The definition in Section 2(6) clearly focuses on supplies made by the taxpayer, ensuring that reverse charge transactions—where tax is paid on inward supplies—are excluded.

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chetan singhania
Beginner
Asked: In:

The QRMP (Quarterly return and monthly payment) scheme

QRMP Scheme under GST
  1. CA Sanjiv Kumar Enlightened Chartered Accountant

    Hi The QRMP (Quarterly return and monthly payment) scheme is introduced to help small taxpayers whose turnover is less than Rs.5 crores. As clear from the name It allows the taxpayers to file GSTR-3B on a quarterly basis and pay tax every month. It was brought into effect from 1st January 2021 for tRead more

    Hi

    The QRMP (Quarterly return and monthly payment) scheme is introduced to help small taxpayers whose turnover is less than Rs.5 crores. As clear from the name It allows the taxpayers to file GSTR-3B on a quarterly basis and pay tax every month.

    It was brought into effect from 1st January 2021 for the users having aggregate turnover of up to INR 5 crores in the previous financial year.

    Previously, taxpayers were required to file GSTR-1 and GSTR-3B monthly, but with the QRMP scheme, they can file returns once a quarter.

    Once the user opts for this scheme, He will continue to be in this scheme unless he crosses the turnover threshold or opt-out of it.

    Use can opt-in/out of the QRMP scheme by visiting the GST portal by clicking Login > Services > Returns. Then, click the Opt-in for quarterly return option.

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Amit Ganguly
Beginner
Asked: In:

  1. PrashantBute Beginner

    Even though both the Form GSTR-2A and GSTR-2B reflects similar details, both the forms are different in various ways. The difference between both the forms is summarized hereunder- Type of statement- Form GSTR-2A is a form of a dynamic statement. The details of inward supplies vis-à-vis input tax crRead more

    Even though both the Form GSTR-2A and GSTR-2B reflects similar details, both the forms are different in various ways. The difference between both the forms is summarized hereunder-

    1. Type of statement-

    Form GSTR-2A is a form of a dynamic statement. The details of inward supplies vis-à-vis input tax credit will be updated on a continuous basis.

    On the other hand, Form GSTR-2B is a form of a static statement. The details will be updated on a constant basis.

    1. The basis for reflection of details-

    In the case of Form GSTR-2A, the details of the inward supplies will be reflected in the statement on a real-time basis.

    In order words, the details will be updated as and when the supplier furnishes the details of outward supplies either in Form GSTR-1 or via using Invoice Furnishing Facility (i.e. IFF).

    For example, the registered person while filing Form GSTR-1 for the month of January 2021 has failed to declare some supplies. The missed supplies were reflected by the registered person while filing Form GSTR-1 for the month of February 2021. Correspondingly, the details of such missed supplies will be reflected in Form GSTR-2A in the month of February 2021.

    However, in the case of Form GSTR-2B, the details of inward supplies will be reflected in a static manner. It will reflect the details of outward supplies reflected by the supplier between two due dates of either Form GSTR-1 or Invoice Furnishing Facility.

    For example, suppose the registered person furnishes the details of outward supplies for the month of January 2021 after the due date. In such a case, the corresponding details of inward supplies and the input tax credit will not be reflected in Form GSTR-2B in the month of January 2021.

    1. Bifurcation of eligible and ineligible Input Tax Credit-

    Form GSTR-2A doesn’t provide bifurcation of eligible input tax credit and ineligible input tax credit. Whereas, Form GSTR-2B briefly bifurcates the eligible and ineligible input tax credit.

    1. Data source-

    Form GSTR-2A collects/ complies data on the basis of returns filed by the supplier in Form GSTR-1; Form GSTR-5; Form GSTR-6; Form GSTR-7 and Form GSTR-8.

    Whereas, Form GSTR-2B complies data from Form GSTR-1; Form GSTR-5 and Form GSTR-6 filed by the supplier.

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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Vishnu Ram Enlightened

    A:If you’re required to register under GST and fail to do so, the law imposes a penalty to discourage non-compliance. Here’s what you need to know: Penalty Provision:Under the CGST Act, if you do not register within the prescribed time, you may face a penalty. This penalty is generally calculated asRead more

    A:
    If you’re required to register under GST and fail to do so, the law imposes a penalty to discourage non-compliance. Here’s what you need to know:

    • Penalty Provision:
      Under the CGST Act, if you do not register within the prescribed time, you may face a penalty. This penalty is generally calculated as a percentage of the tax that should have been collected on your turnover. In practice, it is often around 10% of the tax due on the turnover that required registration, with a minimum penalty amount prescribed by the authorities.

    • Additional Charges:
      Along with the penalty, interest may be charged on the unpaid tax amount until you complete your registration and clear the outstanding dues.

    • Importance of Timely Registration:
      Registering on time not only helps you avoid these financial penalties and interest but also ensures that you can avail input tax credits and comply with other GST compliance requirements.

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Ramesh Sharma
Enlightened
Asked: In:

  1. PrashantBute Beginner

    The rate of tax to be used for the reverse charge supply is the rate that is applicable on such goods/services. GST Compensation Cess is also applicable on reverse charge. If the goods/services purchased in exempted or nil rated then no tax is payable under RCM. Composition dealers are required to pRead more

    The rate of tax to be used for the reverse charge supply is the rate that is applicable on such goods/services. GST Compensation Cess is also applicable on reverse charge. If the goods/services purchased in exempted or nil rated then no tax is payable under RCM.

    Composition dealers are required to pay reverse charge at normal rates (5%,12%,18%,28%) and not at the composition rates (1% or 5%).

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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Vishnu Ram Enlightened

    Reverse charge is a mechanism under the Goods and Services Tax (GST) system where the responsibility for paying GST shifts from the supplier to the recipient. This means that instead of the seller collecting the tax from the buyer, the buyer is required to pay the GST directly to the government. KeyRead more

    Reverse charge is a mechanism under the Goods and Services Tax (GST) system where the responsibility for paying GST shifts from the supplier to the recipient. This means that instead of the seller collecting the tax from the buyer, the buyer is required to pay the GST directly to the government.

    Key Points:

    • Liability Shift:
      Under the reverse charge mechanism (RCM), if you are the recipient of certain specified goods or services, you must pay the applicable GST even if the supplier does not charge it.

    • Applicable Situations:
      Reverse charge is applicable in specific cases mandated by the GST law. This can include:

      • Certain categories of goods and services notified by the government.

      • Supplies from unregistered persons where the recipient is registered.

      • Transactions involving government departments or agencies.

    • Relevant Provisions:
      The provisions for reverse charge are primarily found in the GST Acts (both CGST and IGST), which outline the circumstances and conditions under which RCM applies.

    • Compliance:
      As a recipient, if you fall under the reverse charge mechanism, you must:

      • Pay the GST on the purchase.

      • Ensure proper accounting and reporting in your GST returns.

      • Claim input tax credit (if eligible) on the tax paid under reverse charge.

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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Vishnu Ram Enlightened

    If you fail to file your GST return by the due date, you can incur a penalty under the GST law. Here’s a straightforward explanation: 1. Daily Penalty: General Taxpayers:You may be charged a penalty of ₹50 per day for each day the return is late. Small Taxpayers:If your aggregate turnover is up to ₹Read more

    If you fail to file your GST return by the due date, you can incur a penalty under the GST law. Here’s a straightforward explanation:

    1. Daily Penalty:

    • General Taxpayers:
      You may be charged a penalty of ₹50 per day for each day the return is late.

    • Small Taxpayers:
      If your aggregate turnover is up to ₹1.5 crore, the penalty is typically ₹20 per day.

    2. Maximum Limit:

    • The daily penalties accumulate up to a maximum limit, which is generally ₹5,000 for most taxpayers and ₹1,000 for small taxpayers.

    3. Additional Considerations:

    • Interest:
      Note that aside from the penalty, interest may also be charged on any tax due if the return is not filed on time.

    • Continuous Non-Filing:
      If returns are not filed for a continuous period, the tax authorities may take further actions, such as restrictions on claiming input tax credits.

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Ramesh Sharma
Enlightened
Asked: In:

  1. Amit Ganguly Beginner

    Yes , You can use your firm Name after cancelling its Registration. Cancelling the Registration means Removing its liability of GST which does not impact on its existance. However, in case of wind off the concern , there are no questions of using of Firm Name.

    Yes , You can use your firm Name after cancelling its Registration. Cancelling the Registration means Removing its liability of GST which does not impact on its existance.

    However, in case of wind off the concern , there are no questions of using of Firm Name.

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Ramesh Sharma
Enlightened
Asked: In:

  1. CA Vishnu Ram Enlightened

    Yes, you can apply for the surrender of your GST registration if you no longer meet the eligibility criteria or if you wish to discontinue your GST compliance. Here’s what you need to know: Eligibility for Surrender:If your business turnover falls below the threshold, or if you are no longer engagedRead more

    Yes, you can apply for the surrender of your GST registration if you no longer meet the eligibility criteria or if you wish to discontinue your GST compliance. Here’s what you need to know:

    • Eligibility for Surrender:
      If your business turnover falls below the threshold, or if you are no longer engaged in any taxable activities, you may opt to surrender your GST registration.

    • Relevant Provisions:
      Under the CGST Act, provisions allow taxpayers to voluntarily surrender their GST number. This process is intended to help businesses avoid unnecessary compliance if they are no longer required to be registered.

    • Procedure to Surrender Your GST Number:

      1. Log in to the GST Portal:
        Access your account on the official GST portal.

      2. Submit an Application:
        Fill out the form for cancellation/surrender of registration, providing the required details and reasons.

      3. Compliance Check:
        Ensure that all pending returns are filed and any outstanding tax liabilities or refunds are settled.

      4. Confirmation:
        Once your application is processed, you will receive confirmation that your GST registration has been surrendered.

    • Important Reminder:
      Surrendering your GST number means you can no longer collect GST on your sales or claim input tax credits. Make sure this is the right step for your business before applying.

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