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Should I charge GST?

18 August 2018

I'm buying products from an official distributor of Hindustan Unilever and selling it online. Should the tax be charged from my online customer or it has already been deducted in the earlier transaction?

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8 Replies

Ahanak (Article) (281 Points)
Replied 18 August 2018

you should charge GST on your sale and take the input tax credit paid to Hindustan on purchases

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Aadil Naqvi (21 Points)
Replied 18 August 2018

Can you verify what I get from your answer is correct?
If I get the product for ₹500 with 18% GST applicable. The input tax is ₹76.27 and when I sell it for ₹700, the output tax is ₹106

Ahanak (Article) (281 Points)
Replied 18 August 2018

the site on which u are selling goods might be charging commission from u and paying u the balance after deducting the commission and GST on commission . so if that is the case your input tax credit would be input on purchase i.e; 76.27 + the gst on commission which is deducted by the e commerce operator and both these amount would be reflected in your credit ledger and the balance 107- 76.27- GST ON Commission would be paid by you through electronic cash ledger.
but do provide your GST no. to the person from whom you are purchasing goods.

Aadil Naqvi (21 Points)
Replied 19 August 2018

Thank You. Your advice has been a phenomenal help. Would you clarify the exact situation that I have.
I get the product at ₹662 which includes 18%GST. I am selling it on Amazon for ₹800 for which it is charging--
1). 3% of ₹800 = ₹24 as referral fee
2). Closing fee - ₹20
3). Shipping - ₹45
And 18% GST on these three items.
Total - 1.18*(24+20+45) = ₹105.02

How much do I need to pay to the government? And why do say that I need to provide my GST no to person whom I'm purchasing from?

Ahanak (Article) (281 Points)
Replied 19 August 2018

if u provide your GST no. to the purchaser he will file his gstr1 indicating your GST no. and the amount u pay to your purchaser will be reflected in your credit ledger and you can use balance in your credit ledger to pay your output tax liability. so in your case
1) Input on your purchase = 662/118*18= ₹101 is the gst you paid on your input
2)GST paid by you while selling online is .18 ( 89)= ₹16
3) your output tax liability is .18*800= ₹ 144
you will use ₹ 101+ ₹ 16 = ₹ 117 through your electronic cash ledger and the paid to be paid by you in cash to the government will be ₹144-₹117= ₹ 27
for more appropriate answer specify whether IGST or sgst or cgst is charged on input & output.

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Aadil Naqvi (21 Points)
Replied 20 August 2018

For input. it is an intrastate transaction. so 9% SGST & CGST is applicable while the final sale may be intrastate or interstate.

Ahanak (Article) (281 Points)
Replied 20 August 2018

so you input sgst will be utilised first for payment of sgst and then IGST
and same goes with cgst
but input sgst can't be utilised for payment of output cgst and vice versa .and the balance after adjusting will be paid in cash .