GST Guide – Aaksha.in

Detailed GST Guide for Sellers on Aaksha.in

Introduction: This guide is designed for manufacturers and brand owners selling on Aaksha.in, a multi-seller Direct to Customer (D2C) platform. Sellers can offer products for both retail and wholesale (B2B) with a dedicated Wholesale Price Option. Complying with India’s Goods and Services Tax (GST) regulations is essential for all sellers. This guide covers the important aspects of GST applicable on Aaksha.in, helping you understand your tax obligations.

What is GST?

Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and services in India. It has replaced multiple indirect taxes like VAT, Service Tax, Central Excise Duty, etc. GST is a destination-based tax applied at every stage of the supply chain, with credit available for taxes paid on inputs.

GST Slabs: Products in India are categorized under different GST rates—0%, 5%, 12%, 18%, and 28%. The applicable rate depends on the product category.

Registration Requirement for Sellers on Aaksha.in

Compulsory GST Registration: All sellers on Aaksha.in must be registered under GST, as Aaksha.in facilitates both retail and wholesale transactions across different states in India.

Threshold Limit: Sellers with an annual turnover of more than ₹20 lakh (₹40 lakh for exclusive goods suppliers in certain states) are required to register under GST. For sellers dealing in interstate supplies (common on Aaksha.in), GST registration is mandatory regardless of turnover.
Composition Scheme: Small businesses with a turnover of up to ₹1.5 crore may opt for the Composition Scheme. However, sellers on e-commerce platforms like Aaksha.in are not eligible for this scheme and must register under regular GST.

GST Rates on Products

The GST rate applicable on your products depends on their classification. Common categories include:

Textiles & Clothing: 5% for clothing with a retail price under ₹1,000. For higher-priced clothing, an 18% rate applies.
Electronics: Typically taxed at 18%.
Pharmaceutical Products: Taxed between 5% and 12%, depending on the type.

Ensure accurate classification of products on Aaksha.in to apply the correct GST rate.

Invoicing Under GST

When you sell a product on Aaksha.in, you are required to issue a GST-compliant invoice. The invoice should include:

Your GSTIN (Goods and Services Tax Identification Number)
Buyer’s details (if applicable for wholesale orders)
HSN/SAC code of the product or service
Description of goods/services
Quantity and price
CGST, SGST, IGST breakdown
Total value of the invoice

Wholesale Transactions: For B2B transactions, ensure the buyer’s GSTIN is also mentioned in the invoice for input credit claims by the buyer.

Input Tax Credit (ITC)

ellers can claim an Input Tax Credit (ITC) on GST paid for goods or services purchased for business purposes. This can reduce your tax liability.

Eligibility for ITC: Ensure that the supplier from whom you purchase has a valid GST registration and provides GST-compliant invoices.
Usage of ITC: ITC can be used to offset the GST payable on your sales.

Filing GST Returns

GST-registered sellers on Aaksha.in are required to file regular GST returns. The most common returns include:

GSTR-1: Monthly return for reporting outward supplies (sales).
GSTR-3B: Summary return for tax payments and claim ITC.
GSTR-9: Annual return consolidating all sales and purchase data.

Ensure timely filing of returns to avoid penalties.

GST on Shipping and Delivery

GST on Shipping Charges: If you charge customers for shipping, GST is applicable on the shipping fees as well. For instance, if the product is taxed at 18%, the shipping charges will also attract 18% GST.
Reverse Charge Mechanism (RCM): If services like transportation or packaging are availed from unregistered service providers, the seller might be liable to pay GST under the Reverse Charge Mechanism.

Special Considerations for Wholesale (B2B) Transactions

Wholesale Price Option: Aaksha.in allows sellers to offer a wholesale price for B2B buyers. Ensure you differentiate between B2B and retail sales while filing GST returns to ensure accurate reporting of input credits and tax liabilities.
B2B Transactions: GST-registered B2B customers can claim Input Tax Credit (ITC) on purchases. For these customers, it is crucial to include their GSTIN in the invoices.

Tax Collected at Source (TCS)

Under GST, e-commerce platforms are required to collect Tax Collected at Source (TCS) at 1% on the net value of taxable supplies. Aaksha.in, as an e-commerce operator, collects this amount on your behalf.

TCS Deduction: The TCS amount will be deducted from your payments, and the details will be available in the Seller Manager Dashboard.
Claiming TCS Credit: Sellers can claim the TCS credit in their electronic cash ledger while filing GST returns.

Complying with GST Audits

In case your business is subject to a GST audit, it is important to maintain proper records of all transactions, invoices, and tax payments. Ensure that:

All invoices issued on Aaksha.in are GST-compliant.
Input Tax Credit claims are properly documented.
You maintain updated financial records in line with GST law requirements.

GST on Returns and Refunds

When a customer returns a product, the seller needs to adjust the GST liability for the returned goods:

Issue a Credit Note: For returned goods, you should issue a credit note with details of the original invoice, reducing the taxable value.
Refund of GST: You may adjust the GST liability in subsequent returns.

Compliance with GST Law

E-Way Bill Requirements: For transportation of goods exceeding ₹50,000 in value, an E-Way Bill must be generated. Ensure compliance with this requirement for wholesale orders.
GST Penalties: Non-compliance with GST regulations, such as late filing of returns or incorrect invoicing, may result in penalties.

Conclusion: This GST guide is crucial for ensuring your business on Aaksha.in remains compliant with Indian GST laws. Regularly update your knowledge about GST rates, invoicing, and filing requirements to avoid penalties and optimize your business’s tax obligations.