Professionals for the tax purposes in India include Architects, Chartered Accountants, Company Secretaries, Cost Accountants, Doctors, Engineers, Lawyers, Technical Consultants, Interior Decorators, Film Directors, Cameramen, Artists, Singers, Authors, IT Professionals etc.
The following have been listed out specifically as professions in section 44AA under Income Tax Act, 1961 and notified there under (Notifications No. SO-17(E) dated 12.1.77, No. SO 2675 dated 25.9.1992 and No. SO 385(E), dated 4.5.2001). These normally are applicable for the purposes of GST as well.
(iii) Authorised Representative
(iv) Company Secretary
(vi) Film Artists/Actors, Cameraman, Director, Singer, Story-writer, etc.
(vii) Interior Decoration
(x) Technical Consultancy
(xi) Information Technology
What you do mean by professional services
Classically, services that are provided by advocates, chartered accountant, company secretaries, cost accountant, doctors, engineers, architects and interior, decorators, teachers are regarded as professionals previously but according to the GST Act, the list has included film artist, music director, editors, singers, story writer and many more as professional services which are known as taxable services.
Hence, the purpose of this write-up is to discuss the complexities that are faced by the professional due to the GST registration.
1. GST Registration for professionals
GST Registration for professionals is required for taxpayers who have a turnover of less than Rs. 20 lakhs are exempted from the registration even if the services are provided outside the state. Further, once the turnover crosses the basic exemption limit, the GST registration becomes mandatory.
Kindly follow the respective steps for GST registration:
Gather all required documents for GST registration.
Once documents are ok, make an account on gst.gov.in.
After making the account on gst.gov.in, kindly apply for GST registration.
Fill all appropriate places and then apply for the GST registration.
Follow up and get your GST approved.
Now, let us move on to next step.
2. Valuation of supply of taxable services
Once your GST registration is done, the next step is to understand the valuation under GST. Valuation has a very important role to play under GST because valuation helps us to determine the correct value on which GST can be applied.
Read: Know more about valuation under GST
3. No Composition scheme for Professionals under GST
As per the law, the professionals cannot apply for composition scheme as it is not available to any service providers except restaurant services. Composition scheme is the benefit extended to all small-scale providers who have a turnover less than Rs.1 crore.
4. Books of accounts, Invoices, records
Under the GST Act, professionals providing services are required to maintain records and particulars of supplies where input tax availed and output tax paid invoices should be retained until the expiry of 72 months from the due date of furnishing of annual return for the relevant year.
5. Return under GST
Once you have prepared the bills and done all the required things, the next step is to prepare and file three monthly GST returns. Further, another return in the name of GSTR 3B is also to be filed each month by 20th.
GST was designed in hope to simplify and harmonize the indirect tax regime and to remove the cascading effect faced by the public. However, such simplification and harmonization would be achievable only when the complexity that is faced by the professional not allowed to rise.