Goods & Services Tax (GST) is a percentage of tax that the Government levies on the sale of goods or services. This percentage can vary depending on the goods and their classification, which is specified in the Central Goods & Services Tax (GST) Act. Goods & Services Tax (GST) applies to a range of goods and services for various types of transactions, such as interstate tradeoff, import or export of goods, and declared goods. The rate of percentage of tax levied varies based on whether the transaction is conducted within the state (intrastate trade) or outside the state (interstate trade). An interstate trade involves the movement of goods from one state to another state.
If a dealer fails to remit the taxes, the Government imposes a penalty and the dealer is liable to pay the penalty along with interest for the delay in the tax payment according to the rule governing the tax type.
The Goods & Services Tax (GST) calculation is determined by the Goods & Services Tax (GST) adjustments that are defined in the Advanced Pricing system. The Goods & Services Tax (GST) adjustment contains information that describes the plan of adjustments to be included in the tax calculation. Each adjustment schedule can contain a multiple number of adjustments, such as Goods & Services Tax (GST), education cess, and surcharge. After the adjustments are defined, they can be grouped in an adjustment schedule for calculation.
Dealers are required to submit invoices with forms attached to claim Goods & Services Tax (GST) exemptions. An invoice lists the details of the Goods & Services Tax (GST). Forms such as Form C, Form E, and Form F are used to claim tax exemptions on certain types of goods and transactions. Form C is the most commonly used type of form for claiming sale tax exemption. The form is a declaration of the goods used for manufacturing, resale, and processing that the dealer submits to the Government. A follow-up letter is sent to the dealer with the list of invoices submitted for Goods & Services Tax (GST) exemption without the required concession forms.