Goods and Services Tax (GST) is a destination‑based, multi‑stage tax on consumption introduced in India on 1 July 2017. It subsumed most indirect taxes (VAT, Service Tax, Excise Duty, etc.). GST applies on the value‑addition at each stage of the supply chain, with credits available for taxes paid on inputs.

• Destination‑based: Tax accrues to the State where goods/services are consumed.
• Multi‑stage: Charged at every stage—manufacturer → wholesaler → retailer → consumer.
• ITC mechanism: Avoids cascading by allowing credit of input taxes against output tax.

Note: This page is an informational quick‑start. For legal compliance, rely on Acts, Rules, and official notifications.

Key Terms

Who should register?

• Turnover beyond threshold (goods/services; varies by State/category).
• Inter‑state taxable supplier, casual/non‑resident taxable person, e‑commerce operator, etc.
• Persons liable under RCM, and those required by specific notifications.

Thresholds and exceptions change via notifications—verify on GST portal/CBIC.

Process (high‑level)

1. Apply online (PAN, Aadhaar, bank, address proof).
2. TRN → ARN → verification (Aadhaar/e‑KYC) → GSTIN allotted.
3. Display GSTIN, update invoices, configure e‑invoice/e‑way if applicable.

GSTIN TRN ARN

Mandatory invoice fields

• Supplier & recipient details with GSTIN/State, document type & number, date.
• HSN/SAC, description, quantity/price, taxable value, tax rate/amount (CGST/SGST/IGST), place of supply.
• Whether RCM applies; signature or DSC as applicable.

e‑Invoice (IRP/IRN/QR)

For taxpayers above notified turnover thresholds, B2B invoices must be reported to the Invoice Registration Portal (IRP) to obtain an Invoice Reference Number (IRN) and QR code.

Thresholds have been revised over time—check the current limit before enabling.

Eligibility – quick checklist

• Possess tax invoice/debit note; goods/services received.
• Supplier has reported invoice & paid tax; you have filed returns.
• Use in business; not blocked by law (e.g., personal consumption).

Common blocks

• Motor vehicles (with exceptions), personal expenses, membership/club, works contract (subject to conditions).
• Invoice older than allowed time limit for availing credit.

Required for movement of goods beyond notified value/distance thresholds, generated on the e‑Way portal (Part‑A details; Part‑B vehicle details). Validity depends on distance, with rules for extension and cancellation.

Checklist

• Correct HSN, value, distance, transporter ID/vehicle no.
• Update Part‑B before movement; carry e‑Way Bill/QR.
• Manage multi‑vehicle/multi‑consignment scenarios as per rules.

Reverse Charge Mechanism (RCM)

In notified supplies, the recipient pays tax instead of supplier. Common examples include specific services, goods categories, and import of services. Issue self‑invoice where required and discharge tax in cash.

Exemptions

Specified goods/services are exempt; exports/SEZ supplies are zero‑rated. Maintain documentation to support exemption/zero‑rating and consider LUT/Bond for exports.

HSN (goods) and SAC (services) codes classify supplies and often determine tax rates and reporting granularity. Invoice HSN/SAC disclosure depends on your turnover and notifications.

Need a quick lookup? Use an HSN/SAC search tool or official tariff schedules.

Good practices

• Map your products/services to correct HSN/SAC and maintain evidence.
• Sync codes across ERP, e‑invoice, and returns to reduce mismatches.

Small taxpayers may opt for composition (subject to eligibility). They pay tax at a fixed rate on turnover, with simplified returns and no ITC. Not available for certain supplies/business types.

Considerations

• Heavily B2C? Composition can simplify compliance but increases embedded tax.
• Significant input taxes? Regular scheme with ITC may be better.