GST Guide 2025
Everything You Need to Know

The Ultimate Guide to GST (Goods and Services Tax)

Introduction to GST

Pre-GST vs. Post-GST Taxation

Pre-GST Scenario (Cascading Effect)

Before GST, taxes were levied at exclusive levels, leading to a tax-on-tax scenario:

• A producer buys raw substances well worth ₹1,000 and will pay 10% excise obligation, making it ₹1,100.

• The manufacturer adds ₹500 in cost, making it ₹1,six hundred, and applies 10% VAT, growing it to ₹1,760.

• The wholesaler adds ₹four hundred, making it ₹2,one hundred sixty, and applies 10% VAT, raising it to ₹2,376.

• The retailer provides ₹300, making it ₹2,676, and applies 10% VAT, totaling ₹2,944.

• The retailer adds ₹300, making it ₹2,676, and applies 10% VAT, totaling ₹2,944.

• The final price is higher due to cascading tax effects.

Post-GST Scenario (Tax Credit Mechanism)

• A producer buys uncooked substances for ₹1,000, provides ₹500 cost, making it ₹1,500, and applies 18% GST = ₹1,770.

• The wholesaler provides ₹four hundred, making it ₹2,a hundred and seventy, and applies 18% GST, totaling ₹2,561.

• The store adds ₹three hundred, making it ₹2,861, and applies 18% GST, totaling ₹3,377.

• Input Tax Credit (ITC) reduces the general tax burden, lowering fees.

• GST simplifies the tax structure, reaping benefits corporations and clients by lowering inefficiencies and making compliance less complicated.

Types of GST in India

• CGST (Central Goods and Services Tax): Levied with the aid of the Central Government on intra-nation transactions.

• SGST (State Goods and Services Tax): Levied via the State Government on intra-state transactions.

• UTGST (Union Territory Goods and Services Tax): Levied in Union Territories in place of SGST.

• IGST (Integrated Goods and Services Tax): Levied by using the Central Government on inter-country transactions, imports, and exports.





Applicability & Collection of GST




• CGST + SGST/UTGST are collected and shared between the Centre and State.

• IGST is collected by the Centre and later distributed to the consuming State.

• Exports are zero-rated, meaning GST isn't relevant.




Input Tax Credit (ITC) Utilization




• IGST credit can offset IGST, CGST, or SGST.

• CGST credit rating can be used for CGST or IGST, but no longer SGST/UTGST.

• SGST/UTGST credit may be used for SGST/UTGST or IGST, but now not CGST.




Who does it apply to?




To every person who supplies goods or service of value exeeding Rs 20 lakh for some special category states.

To any person making interstate taxable supply of goods and services.

Every e-commerce operator

Every person who supplies goods and services other than branded services through the e-commerce

Aggregator who supply services under their own brand name

Casual taxable person

Non resident taxable person

Person required to deduct/ collect tax

Input service distributers

GST does not apply to Agriculture

GST does not apply to any person engaged exclusively in the business of supplying goods and services that are not liable to tax or are whole exempted.




GST Compliance & Reporting




GST Returns

• Businesses must file monthly, quarterly, or annual GST returns, including GSTR-1, GSTR-3B, GSTR-4, and GSTR-9.

• Late filing attracts penalties.




GST Invoicing

• Invoices must contain mandatory GST details.

• E-way bills are required for transporting goods.




GST Accounting & Record-Keeping

• Businesses must maintain digital records and comply with audit requirements.

• Non-compliance leads to penalties.




GST Registration

• Mandatory for businesses exceeding turnover thresholds.

• Required for inter-state businesses, e-commerce operators, and exporters.

• Businesses need PAN, Aadhaar, and business documents to register.

• Composition Scheme available for small businesses with simplified compliance.




GST Payment & Refunds

• GST payments can be made online via net banking, UPI, and NEFT.

• Refunds apply for excess tax payments and exports.

• Late payments attract penalties and interest.




GST Rates & HSN Codes

• HSN (Harmonized System of Nomenclature) codes classify goods.

• SAC (Services Accounting Code) applies to services.

• Different GST tax slabs apply based on the product/service type.




GST Software for Businesses

• Helps corporations control billing, invoicing, and tax filing.

• Provides features like e-invoicing, cashbook control, and profit-loss statements.

• Ensures seamless GST go back submitting and compliance.




GST Transition for Businesses

• Businesses migrated from VAT to GST via TRAN-1 and TRAN-2 forms.

• Old tax credits could be carried forward for smooth transition.




GST Penalties & Dispute Resolution

• Fraud, tax evasion, and non-filing attract heavy penalties.

• Businesses can appeal against incorrect assessments.







Sleek Bill GST Software




• GST-compliant invoicing and HSN code lookup.

• E-way bill generation and automated tax calculations.

• Cash Book, Accounting Ledger, and Profit & Loss Statement features.




GST has simplified India’s tax form, lowering compliance burdens and promoting a seamless tax credit score score device. Businesses must ensure right GST registration, invoicing, go back filing, and compliance to avoid consequences. For the modern day GST updates and compliance solutions, discover Sleek Bill GST!