With the enactment of the GST laws, the introduction of destination based taxation GST would replace Excise, Service Tax, VAT, etc.
As GST Law being proposed to be introduced from 1st of July 2017, it is apparent that the management of the organization would face the issues in transition from existing indirect taxation regime to the new GST taxation.
Following are the steps one can follow for easy transition:
Steps involved in GST Transition
The very first step in the GST transition is to migrate from the existing registration to GST after getting the provisional id for migration from current tax logins to GST portal. I am sure that most of you must have already commenced the process of migrating from
existing registration to GST and just in case you have not yet started the migration into GST, be informed that the last date for migration, as of now, is 15th June 2017.
After completion of Migration you will receive an ARN number. On the appointed day, you shall be granted a registration certificate on Provisional Basis mentioning your GSTIN (Registration Number for GST).
Within 3 months from the appointed day, an application has to be made to obtain a Permanent registration certificate. If such application is not made within 3 months, the provisional registration certificate shall be cancelled.
If a person was required to compulsorily migrate to GST because he was liable to tax under the existing Law, however as per GST he is not liable to take registration then the person has to first migrate to GST, obtain provisional registration and then make an application to cancel the provisional registration within 30 days from the appointed day.
Any person paying tax under Reverse Charge Mechanism, an Input service Distributor and person making inter-state supply of goods or services shall be compulsorily registered irrespective of their aggregate Turnover.
2. Balance of Cenvat Credit/Input tax Credit
The next step in GST transition is to make sure that all the unutilized Cenvat Credit which is eligible to be carried forward is correctly reflected in the latest returns, before appointed day, filed under existing laws, i.e. Service tax, VAT, Excise etc. This is very important because whatever unutilized Cenvat Credit is available in your latest return will be eligible to be carried forward in GST with certain conditions and after filing of specified form or declaration.
Within 90 days of the appointed day (01st July 2017 as of now) registered person shall file a declaration in specified form, to take Tax Credit.The Tax Credit will then be transferred to Electronic Credit Ledger of the applicant.
One can claim the tax credit in respect of input held in stock, semi-finished or finished goods held in stock subject to certain conditions.