India is amongst the fastest growing economies in the world all thanks to the growing retail and wholesale industry. Before July 2017 retailers and wholesalers were outside the tax bracket as there was no mechanism to track their actual purchase and sale. GST rules for retail and wholesale businesses have been confusing people ever since.
GST (Goods and Services Tax) is a single tax and applied same for manufacturer, trader, service provider etc. There are no special clauses for retailers as such and GST will apply to retailers and wholesalers just like everyone else.
GST is the kind of tax which is applied to eliminate all the other taxes from the country. It includes the taxes such as VAT, excise duty, service tax, etc. GST is applied in different rates i.e. from 5% to 28% depending on the item.
When do you need to register for GST Number? :
- If the annual turnover exceeds 20 lakhs (10 lakhs for NE states) then you are liable to register under GST.
- If the annual turnover is 20–50 lakhs then you can opt for composition scheme and pay a very low rate of 0.5% (as per the latest GST Bill passed by Lok Sabha).
- If the annual turnover is more than 50 lakhs.
- In case, you are planning to sell through an e-commerce operator (like Flipkart, Amazon) then it is mandatory to register.
Some other GST rules for retail and wholesale businesses
- ‘Tax Invoice’ ought to be issued for taxable merchandise or services.
- ‘Bill of Supply’ is to be issued in case of exempted merchandise or services.
- A unique serial variety ought to be ensured for each invoice
- CGST, SGST ought to be equally charged for native sales.
- For any sale outside the state, IGST shall be obligatory.
- At the time of receiving an advance quantity, Receipt Voucher must be provided. GST is to be charged thereon advance quantity.
- On the sale of any money sale of quite Rs 50,000, it's obligatory to put in writing name and address of the buyer/service recipient.
- GST must be charged on any advance received against the offer of products and services.
- Payment Voucher: A registered one who is paying tax under reverse charge mechanism shall a payment voucher at the time of constructing payment to the provider. The payment voucher ought to contain the prescribed particulars.
- Receipt Voucher is to be issued on receipt of advance payment.
- Refund Voucher: wherever a receipt voucher is issued on advance payment and after no offer is formed and no tax invoice is issued, the registered person could issue a refund voucher to the one who had created the payment.
- Credit Note is to be issued wherever the provider has charged the next quantity of tax whereas tax collectable is a smaller amount than really taken from the receiver in such cases provider must issue the credit note.
- Revised Invoices are to be issued against the invoices already issued throughout the amount ranging from the effective date of registration until the date of provision of a certificate of registration to the several people.
- Debit Note is issued to the recipient for the tax quantity not being charged by the provider i.e. once provider collects a lower quantity of tax than tax quantity collectable on such offer of products and/or services.