Normal Tax payers

An overview

For every transaction we have to raise GST Invoices and required to get GST invoices for the purchases, services availed.

We can classify the sales transaction for the purpose of GST as follows:

Taxable supplies:

For these kinds of sales, the registered person is required to issue tax invoice and collect tax amount separately from their customer while selling goods and rendering services.

Exempted Supplies:

These kinds of sales and services are not chargeable to GST. So the registered person is not required to collect GST from the customers, just they can raise a invoice without GST.

Taxable Purchases

For these kinds of purchases the registered person can claimed Input tax benefit while paying GST to the government.

Exempted purchases:

For these kinds of purchases the purchaser will not be paying GST at the time of procurement of goods and availing services.

Advantages to Normal Tax payers

The normal taxpayers can claim ITC and can apply for the refund incase of excess GST in the Credit ledger.
They can shift the tax burden to another person.
There will be more transparency in the business transaction.
Taxpayers is required to maintain records under one Tax law. Since there were CST, VAT, Service tax, Excise, etc in the past.

Disadvantages to normal Tax payers

There will be huge compliance cost for the registered person which consumes sometime for payment and filling returns.
The time limit laid down under the law should be duly complied with, if not it will lead to levy of interest and penalty by the GST authority.
Expiry of Excess ITC if not claimed within the time limit.
If GST monthly returns are not filled for continuous for 6 months the GST registration will be cancelled.