Air India. June Page 1

Transcription

1 Air India June 2017 Page 1

2 Contents GST Overview Comparative tax scenarios: Current vs. GST Credit Mechanism Concept of Place & Time of Supply Valuation under GST Compliances under GST Page 2

3 Overview of GST Page 3

4 GST roll out: Journey Constitutional Amendment Bill passed and also ratified by > 50% of states Finalization of GST rate structure by GST Council Tentative approval of Return, Transition, Accounts & Records, Advance Ruling, Appeals and Revision, Assessment and Audit & E-way Rules Goods and Services Tax Act Enactment of CGST Act, IGST Act, UTGST Act, Compensation Act Categorization of goods and services in the GST rate and cess structure for most of the products Passage of SGST Bill by State Legislatures & Finalization of Rules Effective from 1 July 2017 Formation of GST Council Passage of CGST, IGST, UTGST and Compensation Bill in the Lok Sabha Passage of CGST, UTGST, IGST & Compensation Bill in the Parliament Finalization of following by council: Invoice Debit & Credit Notes, Valuation, Input tax credit, Payment, Registration, Refund and Composition rules Input tax credit, Payment, Refund, Registration, Composition formats Page 4

5 Present tax structure in India Central taxes Leviable on transactions Manufacturer Trader Service provider Custom duty Import / Export of goods Additional duty of customs On Import of goods - in lieu of excise duty Special additional duty Import of goods - in lieu of VAT Central excise Manufacturing of goods Service tax Provision of services Central Sales tax ( CST) Inter-state sale of goods State/ local taxes Leviable on transactions Manufacturer Trader Service provider VAT Sale of goods within a state Entry Tax / Octroi Movement of goods into local territories Page 5 Creditable/ Refundable Non-creditable

6 Taxes - Subsumed/ Not to be Subsumed Taxes To be subsumed Taxes Not to be subsumed Central taxes State taxes Central taxes State taxes Excise Duty Service tax Value Added Tax ( VAT) Entry Tax/ Octroi/ LBT Basic Customs Duty Export Duties Stamp Duties Electricity Duty Additional Duties of Customs ( CVD) Special Additional Duty of Customs ( SAD) Purchase tax State cesses & surcharges Taxes on professions, trades, callings and employment Taxes on land and buildings Central Sales tax CST ( ) Surcharges and cesses ( relating to supply of goods and services) Luxury Tax Entertainment Tax ( other than levy by local bodies) Other Taxes Rubber cess Page 6

7 Overall GST structure Indian GST Intra-state supplies ( Dual-GST) Centre and States to levy GST on common base ( CGST & SGST/ UTGST) Inter-state supplies / import of goods & services Integrated-GST ( IGST) on inter-state supplies / import of goods and services Minimum exemptions Exemptions notified by Government are largely with negative list/ current exemptions in Service Tax Exclusions from GST Power, Real estate ( partially), Alcohol for human consumption, petroleum crude, high speed diesel, motor spirit, natural gas and aviation turbine fuel Page 7

8 GST rates Exempted goods and services Categories Rates* Nil Merit goods 5% - 12% Standard rate (goods and services) 18% Demerit goods 28% Exports Zero rated The cap of peak rate of tax under GST Law is kept at 40% (20% CGST + 20% SGST/ UTGST) There will be some additional cess on the sin items ( including luxury cars) and the amount shall be calculated basis the quantity or ad valorem Page 8 * The rates given are combined CGST + SGST/ UTGST rates

9 Snapshot : Current vs GST Current applicable taxes GST regime Business Transactions BCD SAD & CVD ED VAT CST Entry tax ST Zero rate/ Refund BCD & cess IGST CGST SGST Zero rate/ Refund 1. Domestic purchase of goods within same state 2. Domestic purchase of goods from different state 3. Domestic purchase of services from within same state 4. Domestic purchase of services from different State 5. Import of goods from outside India 6. Import of services from outside India 7. Stock transfer (within state) and single registration Nil 8. Stock transfer (outside state) Nil 9. Sale of goods from warehouse (within same state) 10. Sale of goods from warehouse (outside state) Page 9

10 Taxable event under GST Taxable event under GST is Supply and it includes 1 Sale, transfer, barter, exchange, license, rental, lease or disposal for a consideration in the course or furtherance of business 2 Importation of service, for a consideration, whether or not in the course of furtherance of business 3 Supply specified in Schedule I even if made without consideration Stock transfers Sale/ disposal of business assets where ITC has been availed on such assets 4 Schedule II specifies activities to be treated as supply of goods or supply of services 5 Schedule III specifies activities that would not be treated as supply of goods or supply of services Page 10

11 Page 11 Credit Mechanism

12 GST credit mechanism GST credit mechanism Input CGST Input SGST/ UTGST Input IGST Output CGST Output SGST/UTGST Output IGST Output IGST Output IGST Output CGST Output SGST Taxes paid on inputs are available as credit against the output tax liability. However, separate credit pools for 3 different types of GST in each state. Input CGST cannot be utilized towards payment of output SGST/UTGST and vice-versa Page 12

13 Input tax credit eligibility 1 Recipient should be in the possession of tax invoice or debit note or other prescribed tax paying document issued by supplier 2 Recipient should have received the goods or services or both 3 Supplier should have paid the tax charged in respect of supply to the Government 4 Recipient should have furnished the monthly return prescribed under section 39 as per statutory timelines If the recipient has not paid (other than reverse charge) the amount of supply along with tax to the supplier within 180 days from the date of invoice, the input tax credit will be added to his output tax liability along with interest * Further, the value of supplies made without consideration as specified in Schedule I ( i. e. stock transfer etc.) shall be deemed to have been paid for the purpose of availment of credit Afterwards, credit disallowed earlier will be reinstated when the payment is made towards the amount of supply along with taxes Time limit for claiming the credit shall not be applicable in respect of re-availment of credit, that had been reversed earlier Seamless flow of credit for the goods and/ or services procured for business purpose and for effecting taxable supplies except the restrictions specified in section 17( 5) of CGST Act. Page 13 * As per Input tax credit rule, interest shall be liable to be paid for the period starting from the date of availing credit till the date when the amount is added in the output tax liability

14 GST credit availment specific exclusions Motor vehicles and other conveyances except when used for making specific taxable supplies viz. transportation of goods/ passengers, further supply of such goods, etc. Health services, outdoor catering, food and beverages except when used for making taxable supply of same category of goods/ services. Travel benefits extended to employees on vacation such as leave or home travel concession, membership of a club, health and fitness centre Rent-a-cab, life/ health insurance except when specifically notified to be services obligatory for employer to provide to employees under any law or used for providing same category of goods Goods lost, stolen, destroyed, written off or disposed of by way of gifts/ free samples Goods/ services used for construction of immovable property ( except plant and machinery) on its own account, even when used in the course or furtherance of business Works contract services for construction of immovable property ( except plant and machinery), except when provided to make further supply of works contract service Goods/ services used for personal consumption Page 14

15 Page 15 Place and Time of Supply

16 Place of supply of goods Supply with movement 3 rd party directing a transfer of title * Supply without movement Place of delivery 3 rd party s registered address Location of goods Installation or assembly at site On board a conveyance Other cases Installation/ site assembly Location where goods taken on board To be determined Goods imported into India - Location of importer Goods exported from India - Location outside India Page 16

17 Time of supply of goods - relevant provisions General ( earlier of) Date of issuance of invoice Last date on which supplier is required to issue the invoice required, under Section 31 Date of receipt of payment ( Date of payment as per books of account or payment credit to the bank account, whichever is earlier) Time of Supply For Goods Reverse charge earlier of ( ) Date of receipt of goods Date on which payment is made( Date of recipient as per books of account of recipient or payment debited to the bank account, whichever is earlier) Date immediately following thirty days from the date of issue of invoice by the supplier ( If not possible to determine as per above specified, than the date of entry in the books of account of the recipient of supply) Supply of voucher Supply identifiable at that point - Date of issue of voucher Other cases - Date of redemption of voucher Page 17

18 Place of supply of services( Location of supplier and recipient in India) Particulars Place of Supply General Rule Supplied made to a registered person, location of such person Supplied made to any other person, location of the recipient of services where the address is on record and location of supplier of services in other cases In relation to immovable property Location of such property If the location of immovable property is located outside India, the POS shall be location of recipient Restaurant and Catering Service Location where the services are actually performed Training and performance appraisal services or sponsorship in regard to event Transportation of goods, including mail & courier Where supplied to a registered person, location of such person Any other person, location where event is held and if the event is held outside india, than the location of recipient Where supplied to a registered person, location of such person Any other person, location at which goods are handed over for transportation Passenger transportation Services Supplied to a registered person, location of such person Any other person, location from where the passenger embarks on the conveyance Banking and other financial services Where supplied to a person on record, location of such person Any other person, location of supplier In case where location of either supplier or receiver is outside India, provisions similar to current Place of Provision of Service rules under service tax have been introduced Page 18

19 Time of supply of services relevant provisions General* (earlier of) Continuous supply of services Other services Invoice issued on/ before payment milestone as per the contract Date of issue of Invoice or Date of payment Invoice issued after the payment milestone as per the contract Date of provision of service or Date of payment Invoice issued within 30 days from the supply of services Date of issue of Invoice or Date of payment Time of Supply For Services Reverse charge earlier of ( ) Date on which payment is made Invoice not issued within 30 days from the supply of services Date of provision of service or Date of payment Date immediately following sixty days from the date of issue of invoice by the supplier (If not possible to determine as per above specified, than the date of entry in the books of account of the recipient of supply) In case of Associated enterprise,, where supplier of service is located outside India Date of entry in the books of account of the recipient of supply Date of payment Supply of voucher Supply identifiable at that point - Date of issue of voucher Other cases - Date of redemption of voucher Page 19 * In case where invoice is not issued, than the date on which the recipient shows the receipt of services in his books of account shall be the time of supply of services

20 Page 20 Valuation

21 Value of supply under GST Inclusions/ Exclusions in value of supply Is the supplier and recipient related No Yes Value to be determined as per Valuation Rules Taxes, duties, cesses, fees and charges levied under any statute other than GST, if charged separately amount paid by recipient instead of supplier Discounts before or at the time of the supply when duly recorded in the invoice issued Post supply discounts when Is price the sole consideration for supply Yes Value of supply shall be the transaction value i. e. the price actually paid for the supply + certain specific additions/ deletions No incidental expenses ( such as commission, packing etc.) charged by the supplier from the recipient Interest or late fee or penalty for delayed payment agreed as per the agreement known before or the time of supply specifically linked to relevant invoices and Subsidies directly linked to the Input tax credit pertaining to price the discount has been reversed by the recipient Subsidies provided by the Central and State governments Page 21

22 Valuation rules under GST Determining value of Supply Consideration not wholly in money Supply between related / distinct persons Supply made through agent Open market value ( OMV ) if recipient eligible for full Input tax credit Invoice value OMV or Where OMV is not available other methods specified if recipient is not eligible for full Input tax credit and goods are intended for further supply 90% of price charged by recipient to its unrelated customer for supplies of like kind and quality 90% of price charged by the agent to its unrelated customer for supplies of like kind and quality If OMV not available value of supply of like kind and quality Where value cannot be determined basis the above discussed mechanism, possible option of valuing at 110% of the cost Where cost is not determinable, reasonable means to determine the value For supply of services, instead of determining basis 110% of cost, option to determine basis reasonable means and general principles of valuation Page 22

23 Invoice under GST For Goods The Invoice shall be prepared in Triplicate in case of Supply of Goods For Services The Invoice shall be prepared in Duplicate in case of Supply of Services Original Copy ORIGINAL FOR RECIPIENT Original Copy ORIGINAL FOR RECIPIENT Duplicate Copy DUPLICATE FOR TRANSPORTER Duplicate Copy DUPLICATE FOR SUPPLIER Triplicate Copy TRIPLICATE FOR SUPPLIER Page 23

24 Compliances- Filing of return Page 24 Page 24

25 GST compliances - returns Current indirect taxes Under GST (CGST, SGST / UTGST & IGST) Law Returns Returns Invoice level reporting is required in returns under GST regime Service Centrally ST-3 (Halfyearly) return is filed tax Following returns would be required to be filed for all registrations (Common returns for CGST, SGST / UTGST, IGST) separately: Report Name Purpose Due Date VAT/ CST/ ET/ LBT Excise Returns are filed as per respective provisions of states mostly monthly returns ER-1 (Monthly) ER-4 (Annually) GSTR-1 (Monthly) Outward supplies 10 th of next month GSTR-1A (Monthly) Details supplied by recipient Auto Populated GSTR-2 (Monthly) Inward supplies 15 th of next month GSTR-2A (Monthly) Details supplied by the supplier Auto Populated GSTR-3 (Monthly) Monthly Return 20 th of next month GSTR-6 (Monthly) ISD Return 13 th of next month GSTR-6A (Monthly) Details furnished by the supplier to ISD recipient Auto Populated GSTR-7 (Monthly) TDS return 10 th of next month GSTR-9 (Annually) Annual return 31 st Dec of FY GSTR-9B Reconciliation Statement Auto Populated ITC-1 Final acceptance of ITC available to recipient Auto Generated A reconciliation statement of GST returns vis-à-vis audited annual financial statement (to be filed with annual return) Page 25

26 GSTR -1 & GSTR -2 GSTR-1 is the return for all outward supplies including sales GSTR-2 is the return for all inward supplies, including purchases amongst others The details of the outward supplies of goods and services as filed by the supplier in his GSTR-1 will be auto-populated in the GSTR-2A For e.g. purchases of components from Vendor A, then the details as filed by the Vendor A in its GSTR-1 will be auto-populated in the GSTR-2A Similarly, the details of the supplies entered by the Tier-2 Vendors would be auto-populated in the GSTR-2A of the Tier 1 Vendor Beyond auto-population of the invoices from the supplier s data, the data related to the imports, inward supplies of which tax is payable on the reverse charge etc. needs to be filled Also, the details that are not auto-populated (since the supplier has not filled the details in his GSTR-1) and the invoices are available will have to be manually filled Also the data in GSTR-2 needs to be bifurcated into Inputs, Capital Goods and Services. This would be required for all the autopopulated data as well as data filled in the Return The recipient of the goods/services shall specify the inward supplies in respect of which he is not eligible, either fully or partially, for input tax credit The detail of inward supply furnished in GSTR-2 should match with the corresponding outward supply furnished by vendor in GSTR-1 Where the input tax credit claimed is in excess of the tax declared by the supplier or supply not declared by the supplier, the discrepancy shall be communicated to vendor as well as to the customer Any discrepancy communicated and which is not rectified by the supplier shall be added to the output tax liability in return for the month succeeding the month in which discrepancy is communicated Page 26

27 Procedure for furnishing returns STEPS Description Applicable Form Timeline STEP 1 Details of outward supplies made during the month to be furnished by the MRF Option of daily uploading of supply details Form GSTR-1 10 th day of the subsequent month STEP 2 The details of outward supplies furnished by the PART A of After due date of filing of Form GSTR-1 Supplier in Form GSTR-1 shall be auto-populated Form GSTR-2A and made available electronically to the MRF of supplies on the GST common portal STEP 3 MRF shall submit the details of inward supplies, post making the required corrections in Form GSTR- 2A, i.e, addition, modification and deletion Form GSTR-2 15 th day of the subsequent month STEP 4 The corrections done by the MRF shall be made available to the supplier for acceptance/ rejection and accordingly, Form GSTR-1 stands amended Form GSTR-1A 17 th day of the subsequent month STEP 5 Details of outward and inward supplies will be autopopulated and made available for submission along with the payment Form GSTR-3 20 th day of the subsequent month Page 27

28 All B2B outward supplies GSTR-1 4 Taxable outward supplies made to registered persons GSTIN/ UIN Invoice details Amount Taxable Rate Value No Date Value Integrated Tax Central Tax State/ UT Tax Cess Place of Supply ( Name of State) ( 1) ( 2) ( 3) ( 4) ( 5) ( 6) ( 7) ( 8) ( 9) ( 10) ( 11) 4A. Supplies other than those (i) attracting reverse charge and ( ii) supplies made through e-commerce operator 4B. Supplies attracting tax on reverse charge basis 4C. Supplies made through e- -commerce operator attracting TCS ( operator wise, rate wise ) GSTIN of e-commerce operator Page 28

29 All Inter-state B2C supplies ( value>rs Lakh) GSTR-1 5. Taxable outward inter-state supplies to un-registered persons where the invoice value is more than Rs 2.5 lakh Place of Supply State ( ) Invoice details Amount Taxable Rate Value No Date Value Integrated Tax Cess ( 1) ( 2) ( 3) ( 4) ( 5) ( 6) ( 7) ( 8) 5A. Outward supplies ( other than supplies made through e-commerce operator, rate wise) 5B. Supplies made through e-commerce operator attracting TCS ( operator wise, rate wise) GSTIN of e-commerce operator Page 29

30 Zero rated supplies and Deemed Exports- GSTR-1 6. Zero rated supplies and Deemed Exports GSTIN of recipient Invoice details Rate Taxable Value Integrated Tax No Date Value No Date Rate Taxable Value Amount ( 1) ( 2) ( 3) ( 4) ( 5) ( 6) ( 7) ( 8) ( 9) 6A. Exports 6B. Supplies made to SEZ unit or SEZ developer 6C. Deemed Exports Page 30

31 All B2C outward supplies GSTR-1 7. Taxable supplies (Net of debit notes and credit notes) to unregistered persons other than the supplies covered in Table 5 Rate Taxable Value Amount Integrated Tax Central Tax State/ UT Tax Cess Place of Supply ( Name of State) ( 1 ) ( 2 ) ( 3 ) ( 4 ) ( 5 ) ( 6 ) ( 11 ) 7A. Intra-State supplies 7A ( 1). Consolidated rate wise outward supplies [ including supplies made through e-commerce operator attracting TCS] 7A ( 2). Out of supplies mentioned at 7A( 1), value of supplies made through e-commerce Operators attracting TCS ( operator wise, rate wise) GSTIN of e-commerce operator 7B. Inter-State Supplies where invoice value is upto Rs 2. 5 Lakh [ Rate wise] 7B ( 1). Place of Supply ( Name of State) 7B ( 2). Out of the supplies mentioned in 7B ( 1), the supplies made through e-commerce Operators ( operator wise, rate wise) GSTIN of e-commerce operator Page 31

32 GST liability in case of advances received from customers 11. Consolidated Statement of Advances Received/Advance adjusted in the current tax period/ Amendments of information furnished in earlier tax period Rate Gross Advance Received/ Adjusted Place of Supply ( name of state) Amount IGST CGST SGST/ UT Tax Cess ( 1) ( 2) ( 3) ( 4) ( 5) ( 6) ( 7) I Information for the current tax period 11 A Advance amount received in the tax period for which invoice has not been issued ( tax amount to be added to output tax liability) 11A ( 1). Intra-State supplies ( Rate Wise) 11A ( 2). Inter-State supplies ( Rate Wise) 11B. Advance amount received in earlier tax period and adjusted against the supplies being shown in this tax period 11B ( 1). Intra-State supplies ( Rate Wise) 11B ( 2). Inter-State supplies ( Rate Wise) II Amendment of information furnished in Table No. 11[ 1] in GSTR-1 statement for earlier tax periods [ Furnish revised information] Month Amendment relating to information furnished in S. No.( select) 11A ( 1) 11A ( 2) 11B ( 1) 11B ( 2) Page 32 The details of information relating to advances would be submitted only if the invoice has not been issued in the same tax period in which the advance was received.

33 Summary of outward supplies and Invoices 12. HSN-wise summary of outward supplies S. No. HSN Description (optional if HSN is provided) UQC Total Quantity Total Value Taxable value Amount IGST CGST SGST/UT Tax (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) Cess 13. Documents issued during the tax period S. No. Nature of Document Sr No Total Number Cancelled Net Issued From To (1) (2) (3) (4) (5) (6) (7) 1 Invoices for outward supply 2 Invoices for inward supply from unregistered person 3 Revised Invoice 4 Debit Note 5 Credit Note 6 Receipt Voucher 7 Payment Voucher 8 Refund Vouhcer 9 Delivery Challan for Job Work 10 Delivery Challan in cases other than by way of supply Page 33

34 All B2B inward supplies ( domestic) GSTR-2 3. Inward supplies received from a registered person other than the supplies attracting reverse charge GSTIN of supplier Invoice Rate Taxable Value Amount of Tax Place of Supply (Name of State) Whether Input/ Input Service/ Capital goods/ Ineligible for ITC Amount of ITC avaiable No. Date Value IGST CGST SGST/ Cess IGST CGST SGST/ Cess UTGST UTGST (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) Page 34

35 All B2B inward supplies ( reverse charge) GSTR-2 4. Inward supplies on which tax is to be paid on reverse charge GSTIN of supplier Invoice Rate Taxable Value Amount of Tax Place of Supply (Name of State) Whether Input/ Input Service/ Capital goods/ Ineligible for ITC Amount of ITC avaiable No. Date Value IGST CGST SGST/ Cess IGST CGST SGST/ Cess UTGST UTGST (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) 4A. Inward supplies received from a registered supplier (attracting reverse charge) 4B. Inward supplies received from an unregistered supplier 4C. Import of service Page 35

36 Import of Input or Capital Goods 5. Inputs/Capital goods received from Overseas or from SEZ units on a Bill of Entry GSTIN of supplier Details of Bill of Entry Rate Taxable Value Amount of Tax Whether Input/ Input Service/ Capital goods/ Ineligible for ITC Amount of ITC avaiable No. Date Value IGST Cess IGST Cess 5A. Imports (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) 5B. Received from SEZ Port Code + No of Bill of Entry = 13 Digits Assessable Value Page 36

37 Details of advances paid to vendors 10. Consolidated Statement of Advances paid/advance adjusted on account of receipt of supply Rate Gross Advance Paid Place of Supply (name of state) Amount IGST CGST SGST/UT Tax Cess (1) (2) (3) (4) (5) (6) (7) I Information for the current month 10 A Advance amount paid for reverse charge supplies in the tax period (tax amount to be added to output tax liability) 10A (1). Intra-State supplies (Rate Wise) 10A (1). Inter-State supplies (Rate Wise) 10B. Advance amount on which tax was paid in earlier period but invoice has been received in the current period 10B (1). Intra-State supplies (Rate Wise) 10B (2). Inter-State supplies (Rate Wise) II Amendment of information furnished in Table No. 10[1] in an earlier month [Furnish revised information] Month Amendment relating to information furnished in S. No.(select) 10A (1) 10A (2) 10B (1) 10B (2) Page 37

38 Summary of inward supplies 13. HSN-wise summary of inward supplies S. No. HSN Description (optional if HSN is provided) UQC Total Quantity Total Value Taxable value Amount IGST CGST SGST/UT Tax Cess (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) Page 38

39 Thank you Ernst & Young LLP 2016 Ernst & Young. All Rights Reserved. Ernst & Young is a registered trademark. www. ey. com/ india This Presentation provides certain general information existing as at the time of production. This Presentation does not purport to identify all the issues or developments pursuant to the transaction. Accordingly, this presentation should neither be regarded as comprehensive nor sufficient for the purposes of decision-making. Ernst & Young does not undertake any legal liability for any of the contents in this presentation. The information provided is not, nor is it intended to be an advice on any matter and should not be relied on as such. Professional advice should be sought before taking action on any of the information contained in it. Without prior permission of Ernst & Young, this document may not be quoted in whole or in part or otherwise referred to in any documents.