GST Calculator – Know How To Calculate Your GST & Its Benefits

Every business that operates in India has to sign up for GST. They must have a GST Identification Code, also called a GSTIN. Customers have to pay this tax on every good and service they buy or use. Due to this, it is vital to know how to calculate GST correctly. You can use the GST calculator to figure out how much it will cost.

GST, which is short for the Goods and Services Tax, is a tax that the Government of India has put in place on a national level. Online websites have several GST calculators that can be used to figure out how much GST will cost.

What is GST?

The Goods and Services Tax (GST) is an indirect tax that is put on the sale of goods and services in India. It is a full, multi-step, destination-based tax that is charged on every value-added step. 

On July 1, 2017, GST took the place of most indirect taxes in the country. Under GST, there are five different tax rates for goods and services: 0%, 5%, 12%, 18%, and 28%.

The government charges GST to sellers, manufacturers, and buyers of goods and services. GST is based on the idea of Value-Added Tax (VAT), which means that it is applied at each step of the supply chain. The GST amount is charged by the last dealer or supplier, and the consumer is expected to pay that amount.

Some things, like gasoline, alcoholic drinks, and electricity, are not taxed under GST, though. According to the old tax system, each state government has its own tax on these products.

Different types of GST

GST can be put into four groups: 

1. Central Goods and Services Tax (CGST)
2. State Goods and Services Tax (SGST)
3. Union Territory Goods and Services Tax (UTGST)
4. Integrated Goods and Services Tax (IGST)

IGST is charged on interstate sales when the place of sale is in a different state than where the seller is located. Intrastate sales are taxed at the same rate as CGST and SGST, which is about half of the GST rate for IGST. This is because the place of sale is in the same state as the supplier.

What is a GST Calculator?

The GST calculator is a handy online calculator that you can use to figure out how much GST you have to pay for a month or quarter. This calculator can be used by buyers, manufacturers, and wholesalers, among others.

How to use the GST Calculator?

You can easily figure out your GST with the help of a professional GST calculator. Even taxpayers who want to use the differential GST rate to figure out GST can use the tool. Here are the steps to take when using a GST calculation tool to figure out GST:

Step 1: Choose “GST Inclusive” or “GST Exclusive” based on what you need.

Step 2: Type in the amount.

Step 3: Choose the GST rate from the list of options in the drop-down menu.

Step 4: Click “Calculate”.

The result will show you the total GST amount as well as the amount before and after GST. Overall, the GST calculation process shows how easy it has become to figure out tax bills since the regime in question was put in place. 

It’s also clear that people now pay a lot less tax on the goods and services that manufacturers sell. The subsumption of the different indirect taxes, which made it hard for everyone to figure out how much tax they owed in total, is another example.

Benefits of using a GST Calculator

Here are some of the most important reasons why you should use a GST calculator:

• It lets users figure out the net or gross price of a product based on GST rates.
• You will be able to tell the difference between SGST, CGST, and IGST and accurately calculate each tax.
• It saves time because you get results right away.
• The GST calculator makes it easier to avoid calculation mistakes.
• It is easy to use and helps you figure out GST without much trouble.

Filing GST Returns

All businesses that have a registered GSTIN must file GST returns monthly, quarterly, or annually. Different businesses have different types of tax returns they need to file.

Businesses that are required to file a GST return must detail their purchases, sales, taxes paid, and input tax credits (ITCs). It is mandatory to file the return with the tax authorities. And, the same data is used by the authorities when determining a company’s tax due.

In this case, it’s important to know that to file GST returns, a business needs to have sales and purchase invoices that meet GST requirements.

Depending on the kind of registration, a business must submit a variety of returns either monthly or quarterly. For example, a regular taxpayer has to file a form called GSTR-1 every month with information about what goods or services were sent out of the country.

On the other hand, a business that is registered under the composition scheme must file a GSTR-4 return every three months.

Advantages of GST

Here are some of the advantages of adding GST on products:

• It helps keep a standard around the world. GST also helps ensure that the manufacturer and consumer are on the same page.
• The main goal of putting GST in place is to stop commercial goods from being taxed twice. It encourages makers and sellers to compete to make and sell high-quality goods, which helps the country’s GDP.
• After GST goes into effect, inflation, which is the most important problem in the market, is likely to go down.

Conclusion

The Goods and Services Tax (GST) applies to all transactions that take place within the country. A GST calculator streamlines the process of estimating payable taxes. You only have to enter the amount and select relevant options to find the amount you have to pay. 

You can check out more blogs related to GST on the Piramal Finance blog. They also offer different products and services to cater to your financial needs.