- Huge benefit to SMEs as Income tax rate reduced to 25% for corporates having annual turnover up to Rs. 250 Crores.
- Exemption for Interest received on deposits raised to Rs. 50000 for senior Citizens
- Mobile phones getting expensive as government increased 20% custom duties on them.
- Cess has been raised to 4% (previously 3%)
- There will be no change in slab rates for the individual tax payers in this budget.
- Standard deduction of Rs. 40000 to salaried people against conveyance and medical reimbursements
- Cryptocurrencies under threat as government will take all steps to eliminate which are being used for illegal fundings.
- Government to launch health scheme by giving health benefits of Rs. 500000 every year to 10 crore families.
- 10% Tax on Long term capital gains exceeding Rs. 1 lakh without indexation.
- Now under Ujjwala scheme 8 crore rural women shall get benefits of free LPG connections.
Download Finance Bill 2018
Notification No. 37/2017- Central Tax
In exercise of power conferred by section 54 of the Central Goods and Services Tax Act 2017 and section 20 of Integrated Goods and Services Tax Act 2017, The Central Board of Excise and Customs specifies certain conditions and safeguards for furnishing a Letter of Undertaking(LUT) in place of Bond by a registered person who is intending to supply goods or services for export without payment of Integrated tax.
Who is eligible to furnish LUT?
All registered persons who intend to supply goods or services for export without payment of integrated tax (IGST) shall be eligible to furnish a Letter of Undertaking in place of a bond.
Who is not eligible to furnish LUT?
A registered person who has been prosecuted for any offence under Central Goods and Services Tax Act 2017 or the Integrated Goods and Services Tax Act 2017 or any of the existing laws in force in a case where the amount of tax evaded exceeds Two Hundred and Fifty Lakh Rupees.
Procedure to furnish LUT?
The Letter of Undertaking is required to be furnished on the letter head of the registered person in duplicate for a particular financial year in the annexure to FORM GST RFD-11
Who can execute the LUT?
The Letter of Undertaking shall be executed by the working partner of a partnership firm, a Managing Director or a Company Secretary of a Company, the proprietor in case of proprietorship or any other person duly authorized by such working partner or Board of Directors of such company or proprietor.
Does LUT has an expiration date?
Yes, The LUT is valid for the whole financial year in which it is tendered. However, if the goods are not exported within the time specified in sub-rule (1) or Rule 96A of CGST Rules and registered person fails to pay the amount mentioned in the said sub rule, the facility of export under LUT will be deemed to have been withdrawn. If the amount subsequently paid, the facility of export under LUT shall be restored.
What is the specified time to pay tax?
Once the FORM GST RFD-11 is submitted to jurisdictional commissioner, register person is bind to pay the tax due along with interest specified under sub-section (1) of section 50 of the Act within a period of
- Fifteen days after the expiry of three months from the date of issue of invoice for export, if the goods are not exported out of India; or
- Fifteen days after the expiry of one year, or such further period as may be allowed by the commissioner, from the date of issue of the invoice for export, if the payment of such services is not received by the exporter in convertible foreign exchange.
The provisions of this notification shall mutatis mutandis apply in respect of zero-rated supply of goods or services or both made by a registered person (including Special Economic Zone developer or Special Economic Zone unit) to a Special Economic Zone developer or Special Economic Zone unit without payment of integrated tax.
Download the Letter of Undertaking here, Click below
Letter of Undertaking Format for GST
Detailed and easily understandable Summary Decisions of 22nd GST Council Meeting
Hello everyone this blog is about detailed understanding of what discussed in the 22nd GST council meeting held at New Delhi on 6th Oct 2017
Ever since Government has rolled out GST on 1st Jul 2017. It has given so much headaches to the Businessmen and to the several Tax practitioners. Tidy schedules for other regulatory compliances and lack of understanding led to so many complexities and increase in cost of compliances for several small business owners. In the view of controlling this complexities GST council has facilitated few major changes that will bring a huge relief to small businessmen before Diwali.
The GST Council, in its 22nd meeting held at New Delhi on 6th Oct 2017, has recommended following changes to ease the burden of small & medium businesses:
After exercising power given under Goods & Service Tax Act 2017, Government on recommendation made by GST Council has increased the limit of annual aggregate turnover from current threshold limit of Rs. 75 Lacs to Rs. 1 Crore
This threshold for turnover for special category states, Except Jammu & Kashmir and Uttrakhand has also been increased from Rs. 50 Lacs to Rs. 75 Lacs. The threshold for Jammu & Kashmir shall be Rs. 1 Crore.
States that comes under special Categories are:
- Arunachal Pradesh
- Himanchal Pradesh
Government has also made sure that this increased limits shall become exercisable for migrated and New Registered Tax payers who are migrated or Newly registered up to 31st march 2018
Those registered Tax payers who has opted for composition scheme shall file their respective returns prior opting this scheme as normal tax payer.
GSTR 4 shall be filed by all the composition dealers by every quarter ending up to 18th of succeeding month
Due to increase in the turnover threshold greater number of tax payers shall avail the benefits of easier and cost effective compliance under Composition scheme and it’ll provide great benefits to the MSME sectors.
No need to get registered for Inter-state supply of Taxable services up to Rs. 20 Lacs
Prior GST, Supply of services was not considered as intra-state of inter-state because It was governed under CBEC, and one single rate was prescribed also the threshold was provided up to the limit of Rs. 10 lakh and Tax payers enjoyed benefits of being Small Service Provider(SSP) given under notification 33/2012 under finance act 1994.
Ever since GST came into existence it brought supply of services within the same definition of supply of Goods and hence, GST become applicable irrespective of turnover criteria. A lot of business got disturbed because of this, further there was no provision of reverse charge mechanism over inter-state supplies other than those provided by Lawyers. It became headaches to several business owners
In the view of said situation government has restored that threshold limits for supply of services. No Registration required under GST for providing taxable inter-state supplies up to Rs. 20 Lacs (Rs. 10 Lacs in special category states except Jammu & Kashmir). This measure is expected to significantly reduce the compliance cost for small service providers
Please Note: The exemption is provided to only service providers and not to traders
Reverse Charge Mechanism Suspended
Government introduced Reverse Charge Mechanism (RCM) under GST for Inward supplies having value more than Rs. 5000 from an unregistered supplier that created fuss for several small businessmen.
GST council on its 22nd meeting has deferred the above provision up to 31st March 2018. This has given huge relief to Small & Medium Businesses.
Only 3 Returns per Quarter Ending for Business having turnover up to 1.5 Crores
In 22nd GST Council Meeting Government has given one huge gift prior Diwali to all the SMEs
In GST, GSTR 1, 2 & 3 was to be filed every month which increased stampede not only it gave anxiety to Businessmen but to Tax Practitioners across country.
Small/Medium business having turnover up to 1.5 Crores need not to file returns every month. In fact, they are given relaxation by filing returns every quarter ending. Hence reduced compliance cost and unwanted anxiety
Goods Transport Agency (GTA)
Most of the GTAs were not providing services to the Unregistered Persons due to this they were facing hardship doing business. In the meeting Government has clarify that GTA no need to take GSTIN for transportation services, hardship lifted SMEs isn’t it?
No TDS/TCS up to 31.08.2018. So Relax
Due date extended for GSTR 4 for Composition Scheme
Due to heavy fuss Council has extended the date for filing GSTR-4 return for composition scheme for Quarter ending (July to Sep 2017) to 15th Nov 2017.
Please note: Normal tax payers who opted for composition scheme shall have to file their returns as normal tax payers before opting for such scheme
Hello People if you have any doubts or query about Goods & Service Tax feel free comment below. We’d hope to resolve it as soon as possible.