Running a small business is difficult. Due to fewer resources (money, time, and personnel), small businesses find it difficult to be GST compliant. While the government is trying to make it easier, GST filing service providers are probably the best solution for businesses.
The GST Council has established certain rules on how all GST registered businesses should keep records, send invoices, report purchases and sales, pay taxes, and file returns. People have to follow these rules and regulations. In other words, GST compliance is defined as conforming to the mandatory GST laws and regulations. Non-compliance with GST norms can lead to heavy fines and penalties being levied on a company.
GST Compliance Rating
The GST compliance rating is a score assigned to a business by the government, which captures the compliance consistency of a company. GST compliance rating shall be assigned to every taxable entity under GST, irrespective of its nature, size, or turnover.
According to the law, if buyers want to claim input credit for their products, they must show all those transactions in which they have paid GST to their suppliers. The higher the compliance score of a supplier, the greater the buyer’s chances of reclaiming input tax credit.
GST Compliance Checklist
Although GST compliance rules are updated regularly and are based on the standards imposed by the government, the GST compliance checklist can be divided into three categories:
- Registration compliance
- Tax invoice compliance
- Return filing compliance
Many other compliance requirements vary depending on the type of business. To learn more about them in-depth, get in touch with a GST specialist.
Reasons Why Small Businesses Are Struggling to Cope with GST Compliance
It is no secret that small companies don’t have much wiggle room in their budget. Owing to such financial constraints, new businesses often make the fatal mistake of skimping on accounting resources.
Research has shown that more than half of all small businesses do not employ a bookkeeper or an accountant. This is one of the biggest reasons why more than 89% of small businesses are struggling to cope with GST compliance. Hiring a skilled and well-trained bookkeeper is a must; if you don’t have the budget for it, consider outsourcing to an affordable accounting service provider.
Lack of Professional Expertise
Another glaringly obvious reason why small businesses are hopelessly failing to comply with GST regulations. And the requirement is that they lack professional expertise in matters about taxation. Likewise, small businesses are curtailed either because they are unable to afford to hire in-house personnel to cover such skill shortfalls. Because they don’t have the necessity to devote themselves to such a time-consuming and demanding affair.
It is also undoubtedly true that small businesses cannot afford to focus their time or energy on any other task except those core activities that can scale up a business.
Compliance is a must, however, it cannot be carried out at the cost of real business growth. That is why small businesses prefer to use the comprehensive GST services provided by Vakilsearch.
Not Having the Right Tools
All taxpayers in India are required to comply with the Indian government’s GST compliance standards. Further, having the right tools to generate, maintain, and record invoices can help meet this end. But it is a luxury that not all small businesses have.
GST compliance requires accurate and systematic recording of transactions and strict adherence to the deadline allotted for mandatory GST compliance. Furthermore, the GST return filing due dates and the GST compliance calendar must be followed without fail.
If you’re looking for a personalized GST compliance calendar for 2021-22, get in touch with our team.
Hesitance in Seeking GST Advisory
Hiring a reliable GST consultant can help ensure that you don’t miss vital deadlines and are compliant with all things GST. As a small business owner, you may not have the finances or the need to engage a full-time GST compliance officer, using an external GST compliance service to take care of it on your behalf can be extremely beneficial. Moreover, such external GST compliance service providers are well-versed in industry-specific GST norms. And regulations have all the tools necessary to ensure 100% compliance.
Vakilsearch has made GST compliance for businesses super easy and hassle-free! Ensure compliance under GST today! Get in touch with our team for the best GST compliance services.