Goods and Services Tax (GST/VAT)

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Goods and Services Tax (GST/VAT)

Goods and Services Tax (GST/VAT) is an indirect tax that is charged for supplying goods and services in India. Goods and Services Tax is levied on the price or value of the goods and services. Goods and Services Tax brought all the indirect taxes such as Value Added Tax (VAT), excise, service tax together under a single taxation system which were imposed on the goods and services sold in India.

Types of GST/VAT registration

The different types of GST/VAT registration are as follows

1.Normal Taxpayer

This category applies to those who are running a business in India. Normal taxpayers are not requiring a deposit.

2.Composition Tax Payer

The taxpayers need to enroll under the GST/VAT composition scheme to register as composition taxpayers. Taxpayers who are enrolled under this category are allowed to pay a flat rate. Although, taxpayers are not allowed to claim the input credit tax (ITC).

3.Casual Taxable Person

A taxpayer who is operating a seasonal shop needs to register under Casual Taxable Person. They need to pay a deposit that is equal to the GST/VAT liability amount. The liability has to match the active registration periods and registration would be active for a three months period.

4.Non-Resident Taxable Peron

This category of registration applies to people who are located outside India. The Non-Resident Taxable Person supply goods or services to the Indian residents. The taxpayer needs to pay a deposit that is equivalent to the GST/VAT liability amount to register as a casual taxable person. The liability has to match the active registration periods and registration would be active for 3 months period.

Advantages and Disadvantages of GST/VAT

GST/VAT has many advantages and disadvantages depending on the nature and size of the business.

Advantages of Goods and Services Tax

The GST/VAT wants to minimize the number of indirect taxes and simplifies taxation

  • Goods and Service Tax has brought all the indirect taxes under one taxation.
  • It simplified the taxation for the sales and purchase of goods and services
  • It is assumed that the cost of goods and services will be minimized in the long run of the business
  • It helps in controlling the sales without any receipts
  • GST/VAT makes the taxation process in a unified way
  • GST/VAT is a simple and easy online process to file a tax return online.
  • It provides a composition scheme for small businesses.

Disadvantages of GST/VAT in India

  • It increases the operational cost of businesses by buying software that helps in the GST/VAT return filing procedure
  • Insurance premium has become expensive with GST/VAT.
  • SMEs may have a higher tax burden
  • GST/VAT will increase the operation cost.

The list of documents required for Goods and Services Tax registration

The list of documents required for Goods and Services Tax (GST/VAT) registration is given below

Individual / Sole proprietor:

  • It increases the operational cost of businesses by buying software that helps in the GST/VAT return filing procedure
  • Owner’s Aadhar card
  • Owner’s photo
  • Address Proof
  • Bank account details

Partnership firm:

  • Partnership deed’s copy
  • Photo and authorized signatories of all partners including managing partner
  • Partner’s address proof
  • Bank account details
  • Aadhar card (Authorised signatory
  • Proof of appointment (Authorised signatory)
  • Registration certificate in the case of LPP
  • Business’s Address Proof of principal place

HUF (Hindu Undivided Family):

  • HUF’s pan card
  • Pan card of Karta
  • Aadhar card of Karta
  • Bank account details
  • Owner’s photograph
  • Business’s principal place address proof


  • Company’s pan card
  • Certificate of incorporation
  • Pan card of authorized signatory
  • Aadhar card of authorized signatory
  • Memorandum/Articles of association
  • Company’s director's pan card and address proof
  • Photograph of authorized signatory
  • Photo of all directors
  • Bank account details
  • Proof of appointment of authorized signatory
  • Address proof of the business’s principal place

What is GST/VAT return filing?

GST/VAT return is a document containing all the information regarding your sales, purchase, output tax, and input tax, that a taxpayer needs file through GSTR forms. Every taxpayer who is registered under GST/VAT law has to file a return in a particular period of time according to the slabs and eligibility criteria.

How to file GST/VAT returns online?

  • You can visit the GST/VAT portal to file GST/VAT return online
  • You will be issued a 15-digit identification number based on your pan card number and state code
  • Firstly, you need to upload invoices on the GST/VAT portal. There would be issued an invoice reference number against every invoice.
  • After that, you will be able to file outward supply return, inward supply return, and cumulative monthly return.
  • You have to file the outward supply return using the GST/VAT portal in GSTR1 on or before the 10th of the following month

In the GST/VAT portal, there is an option to correct mistakes if there are any and refile the returns.

Who has to file GST/VAT return?

Each and all registered business firms need to file monthly return, quarterly return, and annual GST/VAT returns according to the type and nature of the business. All the business firms in India are liable to GST/VAT return which is described by GST/VAT tax authorities. When the seller supplying the goods and services, they issue the GST/VAT invoice to the buyer. It is a document that shows the name of the supplier and recipient, name of product or services, quantity and description of goods and services, HSN code, shipping or billing address, GSTIN, taxable value, GST/VAT charged, supplier’s signature. If you are a registered business organization, you need to issue the GST/VAT invoice to the buyer or recipient for the product or service you supplied. It is an important document to obtain the goods and services tax credit.

E-invoicing in GST/VAT

GST/VAT e-invoice is the digital format of invoices for the products and services supplied created at the GST/VAT portal. Here, the seller issues the GST/VAT invoice in an electronic format.

Steps to register on the e-invoice system

  • Visit IRP (Invoice Registration Portal)
  • Go to the registration tab
  • Provide GSTN details
  • You can click on the ‘Send OTP’. You will get a one-time password from the contact number you submitted.
  • You should enter the OTP and click ‘Verify OTP’ to confirm it
  • Give your username to operate the account. After the successful submission, the system will confirm the data you submitted and generate the username with the password. Hence you can use the username and password to access the e-invoice software.