Goods and services tax (GST) is the indirect taxation system that came into effect from 1st July 2017 in India. Simply Put, It is a multi-level, destination-based, and fully comprehensive tax system. It has created the most significant transformation in the way consumers and businesses pay taxes. Earlier taxes paid were in various indirect ways, which were not only time consuming but also created hassles for businesses. With GST, it has subsumed almost all indirect taxes. And with the availability of GST billing software online, it has created greater ease and mental peace in managing and paying taxes. Be it in the retail, service sector, or GST on real estate. Goods and services tax (GST), in a way, revolutionized the way people pay taxes.
Ease of filing taxes under GST
GST Billing Software made filing of GST easy for taxpayers. At the beginning of GST becoming a law, it was difficult for taxpayers to file their GST. One of the major issues people found it difficult to file their taxes was that they were unfamiliar with the new system and a few new rules that made GST management a nightmare.
For example: A normal taxpayer registered in one state should pay 25 tax returns during a financial year. If this taxpayer has an online store and supplies or sells his goods in all 29 states, then this taxpayer will have to file returns for all 29 states multiplied by 25. By this calculation, if you consider tax filing of a year, it will be about 725 returns. That is almost filing two returns per day. It would have been impossible for businesses like these, and GST billing software has made things easy for such taxpayers.
There has been a massive debate about whether GST has had a positive or a negative impact on businesses in the initial days of it becoming an Act. The effect of GST on the real estate, too, saw a significant change with only 12% tax on under-construction properties and no tax applicable on fully constructed or ready to sell properties.
GST for Different Kind of Businesses
Though there has been a great change in different categories of businesses, it was not easy to implement. People were used to the old ways of submitting their taxes. Earlier, there was a very different format of submitting taxes for goods and services. It was a lengthy process not just for the individuals and businesses to fill out various tax forms but also during the transportation of goods. It was mandatory for vehicles transporting building materials like steel, bricks, or any other goods like consumables or machines to stop at every inter-state checkpoint. With changes through GST on real estate and all other businesses dealing with transporting goods, it saved transportation time by 20%, in turn, helping enterprises deliver faster, creating a better business.
This not only drives home the point that GST helped tax payments become more transparent but also helped cut costs in some aspects for businesses. Though it helped reduce costs for some, it was a major financial burden for small businesses to hire an accountant on a regular basis to file GST because of how complex it was. This, in turn, created a demand for GST billing software as it helped in filing taxes more efficiently.
There have been different accounting companies providing software solutions for GST since the implementation of the Act, and it could become quite confusing in making a choice of what software is best for you. Most of the software that is available in the market doesn't have an accounting feature, and the ones that do have the accounting features are complicated for a user with little or no knowledge. It would be best if you kept in mind to choose software that not only has an accounting feature but is also not complicated. With accounting features, one can easily manage daily expenses, banking, clients, supplier's accounts, balance sheets, financial statements, profit, and loss, etc.
While choosing software to manage GST with just a few clicks, you should consider a few crucial points:
- Security: This point cannot be stressed enough. A secure software not only gives you peace of mind but also prevents you from any hack or fraudulent activity with your account.
- The software should provide an option to add more than one business or shop.
- Look for an auto-update option because there are updates provided by the government from time to time, an option to update with one click will help not only in working on software with ease but also save you from any unwanted inconvenience that may occur.
- If you already have a GST number, then you might already know that GST is of two types. Regular GST and Composition GST. It would be best if you made sure both these options are available in the software.
- A backup option is a must in any work related to files, and with financial documents, it is mandatory. There may be incidents of computer damage, hacking, accidental deletion of data, etc. and a backup could save your day if you happen to experience any such event.
- If you have a garment or a footwear shop, then the software you choose should have the option to calculate the variable tax. An item that you sell for Rs.1000 might have a tax of 10%, but if you sell that same item with a little discount and below Rs. 1000 then the tax could come down to as low as 5%. Having a software that is smart enough to calculate these kinds of tax slabs could help you save big bucks.
- You should check if there is a multi-user option in your software. Often you might not be available to file every sale or purchase, and you might appoint someone from your employees. The software should have an option that allows a controlled or limited use so that the person handling your software doesn't change or edit any listings which they are not supposed to.
- An accountant might not always be available when the due date for filing your taxes arrives. Software with an option to upload files like GSTR 1 and GSTR 3b directly to government websites without the help of an accountant will be hugely helpful.
- For wholesalers whose invoice bills are more than Rs.50,000 and above, an E-way bill is compulsory. Consider Choosing software that has an option to generate an E-way bill.
- "Multiple alternate units" option. If you buy and sell in bulk and if you happen to sell 1 item from a box of multiple units. The software should be able to check the remaining units in the box.
- An option often overlooked is to check whether software could print invoices on all types of papers, whether it is A4, A5, 58mm, etc.
- Everyone needs to file their taxes on time and are complaint and are in the invoicing chain. A software that is flexible to work on multiple platforms like a computer, phone, or tablet will help you keep your files updated on the go.
- Software that works on multiple platforms also helps cut costs. Considering this option while choosing software will benefit in a more significant manner in the long run.
- Not-so-popular, but a great feature in software would be to have a loyalty program. A program where you enter customer details, and on a second or third visit, you give a certain discount. It will help create a solid bond that will keep customers coming back.
The ease of filing taxes with GST billing software considerably helps taxpayers. But getting the right software that is perfect for you will make a considerable difference. There are different software like Vyapar, Profitbooks GST, Zoho books, Tally ERP 9, and Khatabook. These and many other software companies help taxpayers who are looking for filing GST on retail, GST on real estate, or any other category files their taxes easily.