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GST

Businesses must register for GST and pay taxes on their taxable items and services if their annual revenue exceeds Rs. 40 lakhs for goods and Rs. 20 lakhs for services.

GST Registration | Online GST Registration Process

Input Tax Credit under GST - Conditions To Claim

Input Tax Credit under GST - Check Conditions To Claim

BENEFITS of Amazon Business Account - YouTube

GST vs Income Tax​

Income Tax and GST are 2 completely different Acts and tax different things.

Mr. India earns INR 1 crore by selling services to Indian parties. This is professional income for Mr. India. GST on these services applies at 18%

GST​

Mr. India will collect the following amount from his clients:

ParticularsINR
Fees for services1,00,00,000
Add: GST @ 18%18,00,000
Total Collection1,18,00,000

This INR 18,00,000 of GST collected will be paid to the Government. Accordingly, GST is an indirect tax - the clients bear the burden of this amount.

Income Tax​

Mr. India will be liable to pay income tax on this INR 1 crore at slab rates. This is a tax on your income - a Direct Tax. This goes out of your pocket.

A Comprehensive Guide on Tax for Freelancers

Input Tax Credit under GST - Check Conditions To Claim

Foreign Income​

For example, if you receive Rs 1,00,000 as foreign remittance into your Indian bank account, you are liable to pay 18%, i.e., Rs 18,000 as GST to the Indian government. If you receive foreign remittances not in INR but in a foreign currency, you are not liable to pay GST on the amount you received.

Harmonized System of Nomenclature (HSN)​

The Harmonized System of Nomenclature (HSN) is ==a globally accepted system for classifying goods and services==. It's used by more than 200 countries for customs tariffs and international trade.

What is the HSN code used for?​

  • Customs tariffs: HSN codes are used to calculate customs tariffs.
  • GST: HSN codes are used to classify goods and services for GST purposes.
  • Taxation: HSN codes are used to determine tax rates.
  • Trade documentation: HSN codes are used in trade documentation.
  • Inventory management: HSN codes are used in inventory management.

How does the HSN code work?​

  • The HSN code is a six-digit code.
  • The first two digits indicate the chapter.
  • The second two digits indicate the heading within the chapter.
  • The last two digits indicate the subheading within the heading.

Who developed the HSN code?​

  • The World Customs Organization (WCO) developed the HSN code.

Why is the HSN code important?​

  • The HSN code simplifies international trade.
  • The HSN code helps businesses comply with taxation systems.
  • The HSN code helps businesses maintain smooth operations.