Welcome to an era of boundless market. The internet provides a platform for A to Z of goods and services. The last decade has provided an opportunity for businesses to expand their client base many-fold. The need for advertising in limited space has foregone and platforms like Flipkart, Paytm, Amazon, Udaan, Snapdeal etc. have given medium & small enterprises a large market avenue. Business transactions through these giants have snowballed, and the GST law ensured to keep a trail.
If you are planning to expand your business reach through online platforms, we have designed a tool for you to evaluate your decision. Our calculator will consider the financial factors involved in an e-commerce transaction and give you an estimate of your returns. It also gives a breakup of costs involved, tax liability to be discharged, and the amount receivable from the e-commerce portal. This keeps you well informed of your monetary flow even before you approach a seller’s platform for their service.
Profit Margin Calculator (For GST-Exclusive inputs):
This calculator has been designed for GST exclusive inputs. In situations when you have supplies falling under various tax brackets in a single invoice, our calculator will help you save time on calculating and adding GST component on each product/service individually. You only have to enter the price at which you want to sell your Supply (Goods/Service) and the applicable GST rate on it. Our calculator will provide you with the entire summary aforementioned and readily help you with the prices you have to quote, after including GST in it.
Note: In circumstances where certain inputs(amounts) for the calculator are GST-exclusive and certain are GST-inclusive, you may use our GST Exclusive-Inclusive calculator ("https://officeanywhere.io/online/gst-exclusive-inclusive-calculator") to make all inputs uniform and use this tool.
Also take a look at the below mentioned, which will be ingrained in your transactions henceforth.
Procedure (considering the GST law)
Any person wanting to provide Supplies(Goods/Services) through these e-commerce platforms have to obtain mandatory registration.
Turnover threshold limit for registration is not applicable for such persons willing to obtain above-mentioned services; that is limits of Rs.40/20/10 lakh do not apply.
Also, these platforms do not allow to register without a GSTIN.
A person registered under ‘Normal taxpayer’ type can also avail their services. There is no separate category registration as such. Secondly, a person who already has a valid GSTIN need not take another registration.
These e-comm operators act only as an agent connecting sellers & customers. In fact, the seller is selling the product directly to the customer. Hence, the seller has to issue the GST invoice to the customer.
However, to maintain uniformity, these giants give facility to generate invoice from their platform. The seller is just required to print the invoice and send it with the product.
Therefore, the liability to pay GST on sales made is upon individual sellers themselves.
Specific platforms give the option to sellers to add their GSTIN whereas some have not.
However, either the E-comm operator's or original seller's GSTIN is compulsorily required to be mentioned in invoices to enable buyers to take input tax credit of GST.
Services are provided by these platforms for a commission.
It is generally a percentage of the sale price charged by the seller.
Percentages may vary depending on various factors.
The platform charges GST at the rate of 18% on such commission.
The seller is eligible to take Input Tax Credit of such GST paid.
ITC can also be claimed against all invoices issued by the platform. (for various charges)
Where a credit note is issued in lieu of payment of commission or other charges, the GST on such Credit Note is to be deducted from the GST of the Invoice to arrive at the ITC that can be claimed.
As discussed earlier, since sellers selling through these modes are considered no different, Monthly and Quarterly GST Returns are those that are applicable to normal tax payers.
Monthly GSTR-1 is to be filed by 11th of the next month. (that is, for April by 11th May & so on)
Those opting for Quarterly returns, by the End of the month succeeding the quarter. (that is, for Quarter Apr-Jun by 31st July & so on)
Monthly GSTR-3B is to be filed by 20th of next month.
For taxpayers with an aggregate turnover in the previous financial year:
Turnover Exceeding Rs 5 crore- 20th of the next month.
Up to Rs 5 crore- 22nd of the next month for Category X states.
Up to Rs 5 crore- 24th of the next month for Category Y states.
Category X: Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana or Andhra Pradesh or the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands and Lakshadweep.
Category Y: Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha or the Union Territories of Jammu and Kashmir, Ladakh, Chandigarh and New Delhi.
Note: GST Returns are to be filed from the month of registration even if there are no transactions at all. In other words, filing of NIL return is mandatory too. Not complying with this will attract penalty.
Tax Collected at Source(TCS) under GST refers to the tax collected by an e-commerce operator from the consideration received by it on behalf of the supplier of goods, or services who makes supplies through operator’s online platform.
In other words, when the e - commerce operators pay the consideration collected to the vendors they have to deduct an amount as TCS and pay the net amount.
So operators who own, operate and manage e - commerce platforms are liable to collect TCS. TCS applies only if the operators collect the consideration from the customers on behalf of vendors or suppliers.
TCS is charged as a percentage on the net taxable supplies.
E - comm operators are required to deduct TCS at rate of 1 % of total sale price.
This is held from the amount payable to the seller during periodical settlement.
Input Tax Credit can be claimed against such TCS made.
Note: TCS applies only if the operators collect the consideration from the customers on behalf of vendors or suppliers.