Frequent Mistakes Individuals Commit Under GST
There are numerous faults people perform while handling GST taxation. Unless and until you recognize and rectify them on an immediate effect, you may have to suffer a huge loss on the go. Notably, these mistakes can be classified principally into two categories:
- Computational Mistakes
- Conceptual Mistakes
Computational Mistakes
These errors can be considered as minute mistakes while entering the data into a system. For example, if a person’s actual GST bill is near to 1690 and the recorded one is altered as 1960, it can be termed as a computational error.
Conceptual Mistakes
This type of error is a bit more complicated than computational errors and occur due to the discrepancy in the concepts. Falling into such kind of errors can steer the GST consultants in Cochin and taxpayers to greater concerns in future.
Notably, there are seven types of mistakes that happen under GST calculations. Let us discuss them in brief here.
Taxability Mistakes
Errors can arise when there is an inaccuracy in the decision taken by audit firms in Kerala on GST tax slab. For example, if an item is taxable under the past administrations and is currently chargeable under GST, it can be erroneously interpreted as non-taxable.
Grouping Mistakes
Grouping mistakes are errors incurred during classification of items under various sections. For example, cross-classifying an item under one section to that of another can result in settling the wrong rate for the product or commodity.
Time Miscalculation Mistakes
This type of mistake probably occurs if there is a shift in GST rate for an item due to early or late discharge of GST or surplus or slight discharge of GST.
Place Miscalculation Mistakes
If the place of supply is misunderstood and wrongly recorded in the database, it can lead to the levy of wrong taxation amount for the product. Instances of such faults are if a person is addressed payable despite not having a levy of GST.
Estimation Mistakes
An estimation error can lead to a person being recognized as short paid or excess discharged under the goods and service tax regime. For instance, if goods and service tax is not imposed on late or delayed payments, it is called an estimation error.
Another example of estimate error occurrence committed by audit firms in Kerala is when they wrongfully claim the reduction on post-sale discounts. Such errors should be mandatorily be tackled in order to receive statistics with precision.
Tax Tayment & Input Tax Credit Mistakes
Input Tax Credit abbreviated as ITC is defined as the credit of GST imposed on any goods and services meant to be used in the course of business which involves the tax owed under reverse charge.
The frequent occurrence of ITC errors can result in inaccurate or excess availment of ITC payment. ITC that are mistakenly employed on restricted products or services or if the tax imposed on the copy of the invoices without charging it on the original one are some of the examples of ITC errors.
Summing-Up
We have summarily listed some of the most common errors committed by people while obtaining an invoice, file return, ITC payment etc. A. George & Associates, one of the most popular chartered accountants in Cochin have the proven history of serving as reliable GST consultants in kochi and startup consultants in Cochin and can provide you with expert assistance for all your financial queries and find solutions with a professional approach.