India GST
-
Tax Categories used to identify Tax Tiers for India GST. Tax categories are assigned at an item level and are used to identify the tax rates to be applied by a specific tax jurisdiction.
-
In India there are essentially only only 3 tax jurisdictions (CGST, SGST, and IGST) (unlike the U.S. where there are numerous tax jurisdictions. There are exceptions but the Destination Based Tax component should be able to handle those too.
-
Tax codes are assigned to customers to identify the taxes that set of tax jurisdictions that expect to collect taxes for the sale. It's not necessary to assign a tax code to each customer since the customer's state should determine the tax jurisdiction.
Important: If you want a tax invoice to be printed for a customer be sure to enter the GSTIN for the customer.
Go to Office >> Configuration >> General
- Check "Include support for HSN Codes"
Go to Office >> Configuration >> Tax
- Enter your company's assigned GSTID in the Tax Id field.
- Determine if your prices are supposed to include taxes or not. If so then check "Tax Included"
- Click "Use Destination Based Tax"
Go to Office >> Taxes >> Tax Codes
-
Enter the tax codes that your installation requires. At minimum there should be one tax code to represent the location of the company itself.
-
Enter the tax jurisdictions of CGST, SGST, IGST, and any others that may be needed by your company.
-
Enter the tax categories. In the case of India GST this will be one for each tax rate also referred to as the tax slab.
-
And finally enter the tax rates that will be used for each combination of tax code, tax jurisdiction, and tax category.
Return to Office >> Configuration >> Tax
- Enter the defaults for Tax Category, Tax Jurisdiction, and Tax Category
When you set up items add the HSN code for each item and the appropriate tax category. If an item is not assigned a tax category then the Default Tax Category will be used.
For each customer assign the appropriate tax code (unless the default tax code will work for them) and if they are to receive tax invoices be sure to enter their tax id. If the tax id is not provided then the standard invoice will be generated for the customer, otherwise a tax invoice will be generated.
