The Lowdown on Payments on GST

A new tax system was introduced in 2017. The Goods and Services Tax (GST) system came into full force in July 2017. It is a single, comprehensive tax that consumers need to pay the central government on the goods and services that they purchase.

The GST Act was introduced to replace the old tax structure that was plagued with double taxation or the cascading effect of a bunch of indirect taxes such as the Value Added Tax (VAT), Excise Duty, Entertainment Tax, and so on. This article is the lowdown on GST payments.

What are the Different types of GST?

Before talking about making GST payments online, you need to be aware of the different GST types.

Integrated GST (IGST)

You will have to pay this tax to the central government whenever you carry out a transaction between states.

Central GST (CGST)

You will have to pay this tax to the central government whenever you make supplies within the state.

State GST (SGST)

You will have to pay this tax to the state government whenever you make supplies within the state.

Do you need to make a GST payment Online?

Before you decide to make a GST payment online and look for the best methods to do it, you will need to determine which situations require you to make a GST payment online. Here are those cases:

  • If you are done with your GST registration online and move supplies of taxable goods and services

  • If you are registered to the Goods and Services Tax under the Reverse Charge Mechanism (RCM)

  • On the off-chance that you are an E-commerce operator and make supplies of goods and services of various categories, you will have to pay GST online.

  • If you are registered to the Goods and Services Tax and deduct TDS, you ought to make a GST payment online.

  • If you are an E-commerce operator and registered under the GST regime and want to collect TCS, you will need to pay GST.

What is the process of making a GST payment Online?

The process of paying GST online is straightforward and easy to understand. Follow these steps:

  • Log onto the official GST website and enter your vital details such as your username, password, along with captcha code you see and sign in to your account on the GST portal online.

  • After you complete this, go to the ‘Services’ tab, visit the payments section, and click on the ‘Create Challan’ option.

  • You need to enter the amount that you are supposed to pay and select the payment method of your preference. You will encounter numerous payment options to choose from, including over the counter, Netbanking, Debit Card, Credit Card, and NEFT/RTGS. Make sure you submit all the crucial details and choose the option that says ‘Generate Challan.’

  • Once you do this, you will get a description of the challan that contains all your critical information. Click on the MAKE PAYMENT button to make your GST payment online.

  • After your GST payment goes through, you can expect to receive a challan that lists all the tax-related details. This challan will be sent to your cash ledger account.

Which payment methods can I use to make a GST payment online?

Now that you’ve decided to make your GST payment online, here are the two primary ways to get this done:

Using Credit Ledger for GST online Payment

If you are eligible for the credit ledger, you may claim Input Tax Credit to make your GST payments online. However, you ought to remember that the Input Tax Credit will cover only your GST online payments, not your penalties, late fees, and interest.

Using Cash Ledger for GST online Payment

You can make GST payments online or offline through the use of a cash ledger. In any case, you will have to ensure the GST portal generates the challan for your GST payment online.

This quick, light article should suffice to get you started with your GST payments. Be sure to get this done to ensure you are in good books with the authorities.

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