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Highlights of Changes made in GST


Owing to difficulties faced by public regarding complexities in GST, the GST Council, in its 22nd Meeting held on 06th October 2017, has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses, highlights of which are as follows:


1.Composition Scheme


Before Press Release

After Press Release

1.This scheme was available to taxpayers (except special category States) having total annual turnover upto Rs.75 lacs.

For Special Category states this threshold limit was upto Rs.50 lacs.

2.Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme.

1.This scheme shall be made available to taxpayers including Jammu and Kashmir and Uttarakhand, having total annual turnover up to Rs. 1 crore.

For Special Category states this threshold limit shall be increased upto Rs.75 lacs.

2.It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.

This option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period.

For example-If Mr.Jethalal, a hotelier , opted for the composition scheme on 1st November 2017, so he will have to file GSTR-4 from 1st November and he will file return as a normal taxpayer upto 31st October.


The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.


2.Relief for Small and Medium Enterprises

Before Press Release

After Press Release

1.Anyone making inter-state taxable supplies, except inter-State job worker was

compulsorily required to register, irrespective of turnover.

2.The periodicity of return filing for every taxpayer  except composition dealers was monthly.

1.It has now been decided to exempt those

service providers whose total annual turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except Jammu & Kashmir) from obtaining registration even if they are making inter-State taxable supplies of services.

2.It has been decided that small and medium businesses with total annual

turnover up to Rs. 1.5 crores, shall be required to file quarterly returns in FORM GSTR-1, 2 & 3 and pay taxes only on a quarterly basis, starting from

the Third Quarter of this Financial Year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis.


The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017.


3.Reverse Charge Mechanism


Before Press Release

After Press Release

As per Section 9(4) of CGST Act 2017, any Supply of goods or service from an Unregistered supplier to a Registered supplier will cast liability to pay GST to the Government in the form of RCM I.e Reverse charge mechanism.

The reverse charge mechanism under  Section 9(4) of the CGST Act, 2017 and under 5(4) of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be

reviewed by a committee of experts. This will benefit small businesses and substantially reduce

compliance costs.


4.GST on advances received


Before Press Release

After Press Release

On receiving an advance for an order, a supplier had to issue a Receipt Voucher to the person paying the advance. The supplier was required to pay tax on the advance received under GST.

As the requirement to pay GST on advances received was very burdensome for small dealers and manufacturers, it has been decided that taxpayers having total annual turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies

shall be payable only when the supply of goods is made.


5.Services by GTA to unregistered persons

It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.


6.TDS/TCS provisions in GST

GST Council has recommended that the mechanism for registration and operationalization of TDS/TCS provisions remain suspended till 31 March 2018. In the meantime GST Council will review the readiness of the trade, industry and Government departments and may decide to operationalise the TDS/ TCS Mechanism under GST w.e.f. 1 April, 2018 and onwards.


7.E-way bill system under GST

E-way bill is an electronic way bill for movement of goods which can be generated on the GSTN (common portal). A ‘movement’ of goods of more than Rs 50,000 in value cannot be made by a registered person without an e-way bill.

In order to give trade and industry more time to acclimatize itself with the GST regime, GST council has deferred the E-way bill provision upto 01/04/2018.


8.Last date of filing GSTR-4 and GSTR-6

The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.


9.Modification of Invoice rules

Invoice Rules are being modified to provide relief to certain classes of registered persons.

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