GST Impact on CA and CS Professionals in India

The New Tax, New Opportunity!! After more than a decade of waiting, it finally GST is passed in both houses of Parliament. Now there is an easy way for bringing a new tax reform in India. Currently we all professionals are talking about indirect taxation improvement. GST is a great step in this regard and we are thankful for this.

For our professional friends, a new tax has come with lots of new areas of practice. As the “One Tax One Nation” rule is applicable, now our working area became wider. Because now this is not related to any particular state but the rules and regulations are all similar all over the nation.

What Chartered Accountants are Charging Under GST?

Also, chartered accountants and chartered secretaries have steeped hikes in their professional fees. According to the prevailing fee structure, the CA charges anywhere between INR 2000 to INR 5000 per client. But after the implementation of Goods and Service Tax, the CA community has raised this fee structure to a staggering approx. INR 25000 per client. The reason behind this hike is the monthly filing procedures introduced under the GST which was prior quarterly. As this increase took a load over the CA community so the price matter automatically gets framed up.

How GST Changed the Chartered Accountant Work Scenario?

In the previous scenario of VAT, lots of work was done manually and it resulted in a waste of precious time as well. But in GST all the work is done on an online basis and that’s why our work is easier and saves time also.

Previously in VAT, we professionals were restricted only to one or two states, because in each and every state there were different forms and laws applicable but now in GST there is the same return from all over the nation and it has increased our working area.

Again in VAT, previously we could upload the return every month and there was a requirement to fill the Sales and purchase register as well as the main return. After that, if there was a tax credit mismatch then again the whole process was repeated. This was a hectic and time taking process.

But in GST when we upload a client’s sales register then the data will be automatically reflected in his purchaser’s purchase register. In this practice, the workload to fill the purchase register is less same in the main return form most of the data will be auto-populated from the client’s sales and purchase register and again the workload to fill the full main return form has decreased. As well as the mismatch issue is also resolved after this practice.

Recommended: GST vs VAT: Simple Way to Describe the Differences

Next Step for Chartered Accountants? In GST, there is an annual return form for “Statutory Auditors” information to be entered. In that case, the auditor is also liable that the details provided in the VAT return are true and fair and there are no differences in books and GST returns.

If there are any differences in quarterly returns then such differences must be resolved in the annual returns of the GST. In the GST draft law, there is a provision for a “Special Audit” which is also conducted by Chartered accountants or by a Cost Accountant. One window solution is possible. After GST implementation the work area of professionals has become wide and they can provide a single-window solution to their clients.

According to the Service Tax ruling, a service provider had the right to receive credit for the service tax paid on input services, as well as the excise duty paid on inputs and capital goods. However, the service provider was not eligible to receive credit for the VAT paid on inputs and capital goods. This was considered as a cost to the service provider.

Chartered accountants registered under GST are entitled to input tax credits for both goods and services, which reduces the overall cost.

To claim input tax credit, it is important that the goods and services are received, and the invoice for the same is received with the recipient’s GSTIN. Additionally, the supplier must have paid the applicable GST on the same and filed their GST return. If any of these conditions are not met, input tax credit will not be available as per Section 16(2) of the CGST Act.

Define Services Accounting Code (SAC)

It is mandatory to mention the Services Accounting Code (SAC) on all invoices raised. This was not required under the Service Tax legislation as there was only one category of service, which was Chartered Accountancy Services. When creating an invoice, it is important to consider the nature of the services provided and its corresponding service classification. The following is a list of the most common classifications of services that cover the regular services provided by practising chartered accountants.

Next Step for Chartered Accountants?

We are a developing country where a large number of startups and small companies are working independently. After GST implementation these companies started working according to the new taxation system. So they are in need of professional workers who know about GST. And that is why the demand for professionals with GST knowledge has increased that much.

GST is a privilege for new Chartered Accountants too. The reasons are very obvious the new indirect tax system is very fresh for each CA and it is an additive point for the new CAs. It is helping not only old CAs in generating revenues but also beneficial new CAs.

As GST regime is more focused on bringing down the prices of goods and widening the tax scope. Our work has become more in advisory and compliance-related jobs. Newly certified Chartered Accountants can take advantage of it in furnishing their career and create the same recognition as the existing CAs. They can even provide online services, join forums and answer queries asked by taxpayers, make online videos, and start blogs to simplify the procedure of filing GST return forms. The step forward to utilizing online penetration is helping some new CAs in getting clients and it is equally beneficial for all of us.

As the CA’s are the company’s key persons and it’s our responsibility that we are aware of the GST law and return, registration procedure, challan payment, auditing etc. so that we can provide the best services to our clients. In today’s time, it’s important for all our professional friends to keep themselves updated regarding GST and so in this tax regime, we can help to create a better taxation system for the development of a better INDIA.