B2C Both Intra state & Inter state selling of goods with under 20 lakhs turnover. Do i need GST?

Hi,
My family has started a cold pressed oil business as a sole proprietor. Manufacturing and processing location is Cheyyar(Thiruvannamalai Dist, Tamil Nadu). Our sales channel is through offline sales. We plan to sell the products only directly to consumers(B2C) primarily in Bangalore(Karnataka) and Chennai(Tamil Nadu) . If we ship to consumers within Tamil Nadu it becomes intrastate and if ship outside Tamil Nadu it becomes interstate.

Browsing the internet, I found that GST is mandatory for inter state supply of goods. Also we are expecting our turnover to be less than 20 lakhs for 1-2 years. I consulted a CA in my town a year back and he told GST is needed and I have a GST now and we are filing returns every month. But I am still a bit confused if GST is mandatory in our case. Reason is our products price increased and therefore affecting my sales conversion because of competitive pricing.

I don't understand the meaning of supplier. If I am selling directly to consumers(B2C), am I still a supplier and therefore do I have charge the consumer GST.

Also wanted to know if I can charge GST only for interstate consumer transactions and not the intrastate consumer transactions.

To summarise:
- Am I considered a supplier if I am selling to end consumers directly(B2C) both within state and outside state? Given that turnover is below 20 lakhs and other scenarios, do I still need a GST?
- Or Can I charge GST for my interstate consumer transactions only and not for my intrastate consumer transactions?

Asked 2 years ago in Taxation

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4 Answers

Under GST, interstate supply attracts Integrated Goods and Services Tax or IGST. Intrastate supply attracts both Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST). In the case of intrastate supply, the GST rate for the goods or services would remain the same

Mandatory Registration for GST Reporting

People or organizations that engage in interstate taxable supply.

individuals who, either as agents or otherwise, make taxable supplies of goods or services on behalf of other taxable individuals.

Distributor of input services, whether or not individually registered under the Act.

Exemption will only be for those having an annual turnover of up to Rs 20 lakh and those not making any inter-state taxable supply

T Kalaiselvan

Advocate, Vellore

89977 Answers

2492 Consultations

Talk to Advocate T Kalaiselvan

Thank you sir for answering.

I understood that GST is mandatory in my case. I already applied and have GST No with me.
I would like to know if for all sale transactions we do (intra and inter state), we have to charge the customer GST amount irrespective of within the same state or different state. Do I have an option to charge GST for outside state customers and not for within my state customers?

Just to explain my scenario, we are setting up this small business for my uncle to earn a small income. We have few customers in chennai and bangalore. To do formally and legally we wanted to follow the process. But GST is causing price increase and filing return formalities. We may earn a profit of max 10k per month in next 1-2 years. I thought as we grow big, GST and filings we can take it up and manage. But at this point in time i am thinking if this is additional overhead.

Please suggest if there are any other things we can consider incorporating.

Asked 2 years ago

You cannot think about deviating the law or flout the rules for any reason.

The GST is paid by the customer.

If you would like to conduct the business peacefully and hassle free, don't think about such petty issues.

You can go by law.

You can even take suggestions from your auditor on any legal concessions.

T Kalaiselvan

Advocate, Vellore

89977 Answers

2492 Consultations

Talk to Advocate T Kalaiselvan

Dear client,

As per the GST Act, if you are a registered taxable person, you are required to charge GST on all taxable supplies of goods or services made by you. Therefore, for all your sale transactions, whether they are intra-state or inter-state, you will have to charge GST to your customers.

In your case, you cannot choose to charge GST only for inter-state transactions and not for intra-state transactions. The GST law requires you to charge GST on all taxable supplies made by you.

If your turnover is less than Rs. 20 lakhs, you can opt for the Composition Scheme, which allows you to pay GST at a lower rate and also reduces the compliance burden. However, this scheme is not available to businesses engaged in inter-state supplies of goods.

If your business is making a profit of only Rs. 10,000 per month, you may consider whether registering for GST is worth the additional overhead. However, if you plan to expand your business in the future, you may want to continue with GST registration so that you are compliant with the law.

In addition, you may want to consult with a tax professional or a CA to explore other ways to reduce the cost and burden of GST compliance for your small business.