What do you Mean by supply of goods and services in GST regime
The existing system of goods and service levy of tax on manufacture, provision of taxable services, and sale of goods which will be replaced by the concept of ‘SUPPLY’. The taxable event under GST is the ‘Supply’ of Goods or Services. It is very essential therefore, to understand the place of Supply in determining the right charge of tax on supply. The model GST Law lays down the criteria to determine the place of supply. Based on these criteria, you can treat the supply of goods or services as either Intra-State (within the State) or Inter-State (Outside the State).
what is Taxable event under GST law ?
The taxable event under GST shall be the supply of goods or services made for consideration in the course or advancement of business. The taxable events under the existing indirect tax laws such as manufacture, sale, or provision of services shall stand subsumed in the taxable event known as ‘supply’.
There are two important components which determine the tax to be charged on a supply:
• Location of the Supplier – It is the registered place of business of the supplier
• Place of Supply – It is the registered place of business of the recipient.
Category of Supply
- Supplies made for a consideration in the course of or for furtherance of business
- Supplies without consideration
- Supplies made for a consideration whether or not in the course of or for furtherance of business
The following are considered as supply with consideration:
|Sale||Any sale of goods or services which broadly result in the transfer of title in case of goods, and transfer of right to use in case of services.|
|Transfer||Any transfers between branches form a part of supply and are taxable. However, GST paid on branch transfers are fully available as Input Tax Credit.|
|Barter||When the consideration is paid through goods instead of money. For example a seller has supplied goods and the buyer, supplies goods to the extent of payment. Or when one product is exchanged with another product.|
|License||Any grant of license to use forms part of supply. For example: online subscriptions|
|Rental||Renting of property fully or partially is a supply under GST|
|Lease||Letting out the building or property on lease is a supply under GST|
|Disposal||Disposal of business assets forms part of supply|
Place of Supply under GST
|General Service:||Location of receipt ant where the record of address exist. and record of supplier of goods or serivce exist in other case.|
|Supply of service in case of immovable property||Location at which the immovable property|
|Supply of service by way of organization of event||Place where the event is actually held|
|Supply of service by way of transportation of goods including by mail of courier||Location at which such goods are handed over for their transportation|
Example to understand the concept of supply under GST era
GST Intra state supply:
A ltd a supplier of computer in Noida Uttar pradesh supply its goods to Mohan Ltd in Gaziabad Uttarpradesh is considered as supply of goods .
Supply of goods : Place of supply is Mohan ltd in gaziabad which is with in the state Uttar pradesh .In the intra state supply the taxes to be charges are SGST and CGST.
GST Interstate supply:
A ltd a supplier of computer in Noida Uttar pradesh supply its goods to Sohan Ltd in Jaipur Rajisthan is considered as supply of goods .
Supply of goods : Place of supply is Sohan ltd in Jaipur Rajisthan which is with in the state Rajisthan .In the inter state supply the taxes to be charges are IGST.
See also: File of returns under GST
Impact of GST on Indian Economy
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