How can small businesses deal with GST Compliance

How can small businesses deal with GST Compliance

What is GST Compliance?

The government gives a score to a business to let the other businesses know how that business is compliant with the tax department. This is known as the GST Compliance rating. This score is decided based on the parameters such as timely filing of monthly and annual returns, furnishing details of input credits used, complying with GST rules and regulations, and cooperation with the tax officials. etc. 

GST compliance services

GST Amnesty Scheme 2021

The taxpayers can file the pending GSTR-3B for any tax period between July 2017 - April 2021 until 31st August 2021, without the maximum GST return late fee tariff. The period of pending GSTR-3B is increased to 30th November as per notification No 33/2021 dated on 29th August 2021.

Goods and Service Tax (GST) Registration

GST registration is compulsory for the business which sells goods and provides services within the state of its settled premises, making the revenue of more than ₹20 Lakhs annually or if the business is providing goods or services outside the state. Even if you don't even have the threshold, still you can apply for GST.

Monthly/ Quarterly returns (GSTR-1 and GSTR-3B)

Only one Quarterly return facility in GSTR-1 is available if turnover is upto 1.5 crores, but GSTR-3B must be filed monthly. A person with a turnover of up to Rs. 5 crores can file a return every quarter in the preceding year. However, a person can choose to file on a monthly basis also. Selecting to file GSTR-1 and GSTR-3B on a quarterly basis means he has to file both the GSTR-1 and GSTR-3B on a quarterly basis; both will be filed on a quarterly basis; otherwise, both will be filed on a monthly basis.

Quarterly returns under Composition scheme (GSTR-4)

A normal taxpayer needs to pay GST every 3 months, whereas if the person has applied for the GST return of GSTR-4, which is a composition scheme, has to furnish only 1 return which is GSTR 4 once in a year on or before the 30th of April. 

Annual Consolidated Return (GSTR-9)

A regular taxpayer has to file the GST annual return form once a year, which is called  GSTR 9. This form is filed with all the consolidated details of SGST, CGST and IGST paid during the year.

For export of goods - Letter of Undertaking (LUT)

Businesses that wish to export goods/ services without payment of GST shall file a letter of undertaking annually. 

Cancellation of GST registration

If you want to cancel your GST because you are closing your business or you, or GST is no more applicable to you or any professional or tax officer calls you to cancel the GST. You have to register for the cancellation of GST.

Revocation of GST cancellation

If a person's GST registration is canceled suo moto by the proper officer, then he can supply revocation of cancellation. The application has to submit it within 30 days from the date of service of the cancellation order at the Common Portal.

GST impact on small retailers

Positive Impact.

Setting up a business is trouble-free:

Due to GST, the tax rates are uniform all across the country, and with centralized registration,  small businesses get the opportunity to build up with ease.

Services and proper logistics were delivered quickly.

The removal of entry tax on goods purchased or manufactured in any part throughout the country has remarkably speed up the process of transporting and delivering goods at checkpoints in every state, leading to a reduction in transport cost, thus positively impacting the small businesses.

Consideration of Goods and services to be the same.

No tangible distinction between the product and services has decreased the practice of evading tax to an extent. The requirement to calculate only the tax amount on the final product has made it easy for SMEs to prepare the invoice.

Opportunity to pay lesser tax

GST has replaced all the indirect taxes, due to which the SMEs now find it very beneficial as it has lessened their tax immensely.  

Negative impact 

Lack of technological facilities

Most small retailers and businesses do not have the necessary facilities, which will benefit from opting for filing GSTR online. As a result, they need to acquire the relevant external source that will help them with the process of GST registration leading to an increase in their cost.

Compulsory multiple registrations for businesses that function all over India.

GST has made it compulsory for the businesses that run in more than one state to register themselves in all those states. This leads to a difficult and more complex situation for SMEs.

How SMEs can cope with this?

GST invoicing and Billing

GST invoices can be quickly generated from your mobile or computer. Error-free invoices are created in seconds having accurate GST rate and computation with the inbuilt catalog or the contacts. Multiple currencies are supported, and the invoices bills can be shared with the customers through networking services. 

Receipts and payment gateway integration

Receipts can be issued to the customers, and multiple payments that are against the invoices can be reconciled. Ledgers can be quickly integrated with any type of payment gateway.

Accounts statements

Account statements can be generated and shared with the clients instantly, view the customer-wise accounts receivables overdue invoices, and also send payment reminders with the payment links. Creating supplier account statements with purchase details, the payments made, and the payable.

GST return filing and ITC reconciliation

API integration helps directly in issuing the error-free GSTR 3B and GSTR 1 invoices from LEDGERS. Using invoices, payments, and credit note data, GST returns are auto-prepared. Use LEDGERS to file the GST returns, matching of purchase made against input tax credit from received ITC. Know the suppliers, not the ITC, and follow up to avoid ITC leakage. Quickly reconcile with purchases against the ITC received to prevent time and money.

Contact Us for GST Compliance, GST Consultant & GST Services in Delhi, Noida, Gurgaon, and all across India: write to us at Or Call On :(+91)-9711021268 +91-9310165114

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