In a series of announcements the GST Council on Friday 6-Oct simplified the compliance requirements for GST. The far reaching changes in GST are designed to ease the burden of SMEs and exporters.
- Composition Scheme turnover limit extended- The turnover limit for businesses to register under the composition scheme has been extended from current Rs. 75 Lakh to Rs. 1 Crore. Lakhs of businesses in the Rs. 75 Lakh to Rs. 1 Crore bracket will be able to get the benefit of lower tax rates and freedom from Monthly Return Filing requirements
- Quarterly Return Filing for Businesses less than Rs. 1.5 Crore – In a bid to simplify the compliance for 90% of the traders and businessmen the GST council has removed the requirement for monthly return filing for businesses with turnover less than Rs. 1.5 Crore. Previously they had to file the returns 3 times a month. Now it is greatly simplified to once every quarter. This will be applicable from Q3 FY 2017-18 starting from 1st For the transactions in Q2 from 1st July 2017- 30th September 2017 the businesses registered in the regular scheme have to file the monthly returns
- Staggering of Return Filing Dates – The govt. has announced that the return filing dates for the quarterly returns and the monthly returns will be staggered. This will reduce the load on the GST servers and enable smoother filing of the returns
- Simplified refund for exporters In a major relief to the exporters the govt. has said that the refunds for month of July will be credited from 10th October and for the month of August will be credited from 18th From 1st April 2018 an e-wallet facility will be started which will give a notional amount in advance to the exporters and the actual refund amount will be adjusted against this notional amount. The businesses under Advanced Authorization Scheme, Export Promotion Capital Goods or 100% export oriented units have been exempted from paying taxes on inputs till March. This will greatly improve the liquidity of the exporters. They have to pay notional 0.1% GST to enable their suppliers to claim Input Tax Credit
- Simplified Input Tax Credit – The govt. has simplified the Input Tax Credit for Businesses. The govt has allowed the business to take Input Tax Credit on a monthly basis even if they buy supplies from businesses filing quarterly returns
All these steps will simplify the compliance requirements for the SMEs as well as enable them to get faster refunds leading to better cash flow.
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