Goods and Service Tax (GST) marks a revolutionary point in the Indian Tax System history as it significantly reformed the entire taxation system in India. GST is the ONE tax that replaced many indirect taxes in India and thus popularly known as “One Nation One Tax“. The rule came into effect from July 01, 2017.
Formerly, the tax was levied on every stage from product creation to selling, GST replaced them all with a single tax that has many benefits. The GST has mainly avoided the overlapping of taxes by state and the central government and removed the cascading effect on selling of goods and services that directly impact the product price. As the tax is eliminated during every stage, product price gets decreased.
Under GST, mainly 3 types of taxes are applicable: CGST, SGST, IGST, UTGST depend upon the business origin and destination states or union territories. If the selling is performed under the same state, CGST + SGST gets applied, if the selling is performed under different states, IGST is levied and if the selling is performed within same union territories, CGST + UTGST is applied. Take a look at below table to get a clear idea on how GST is calculated:
|Business Origin||Destination||Calculated GST|
|State||Same State||CGST + SGST|
|State||Different State/Union Territory||IGST|
|Union Territory||Same Union Territory||CGST + UTGST|
|Union Territory||Different State/ Different Union Territory||IGST|
Implementing the whole GST regime in Magento is the really tricky, time-consuming and tedious task. To ease it for Magento store owners, we have developed a Magento GST India extension which can be installed to automate the whole GST system in Magento stores.
How to Configure Magento GST by Meetanshi to charge Indian GST on your store products:
Simply install the Magento GST extension in your Magento store and enable it from the backend.
Buyer GSTIN for Input Tax Credit
There are cases when you are working with wholesalers and retailers who want to add their GSTIN to claim input tax credit (ITC) for GST after paying to you. In this case, the extension allows enabling buyer GST from the frontend to be entered by such customers.
Magento GST Invoice Format
After the GST regime, an order invoice must be sent in a predefined format containing all the details related to the seller such as GSTIN, CIN, and PAN number. Simply set all these details in the backend to be included in the order invoice PDF.
GST Rate Slabs
Many of the products fall under the same category but the GST rate is defined based on the product prices. For example, as per GST Rates, apparels under 1000 INR has to be charged 5% of GST whereas apparels above 1000 INR has to be charged 12%. In this case, you need to set up two tax rates and define a minimum amount to charge appropriately. To serve the purpose, our extension facilitates to set GST rate for all the products of the store, define minimum amount to charge the set rate and set another rate for the product prices below minimum set amount.
Calculation of GST based on Business Origin-Shipping Destination
The whole GST calculation works on business origin state and destination of the order. Admin can define business origin from the backend and when the customers choose their shipping address, they add the destination state; and GST is calculated based on the table above.
Product Prices Inclusive-Exclusive of GST
Extension facilitates the option to show products inclusive of GST or exclusive of GST. In the first case, the GST is already included in the product price but will show separately but not added to the subtotal. Where in the second case, GST is added with the product price and shows the subtotal. Let’s understand this with an example:
|Product Price Inclusive of GST (5%)||Calculation Bifurcation||Subtotal|
|100||95.238 (base Price) + 5 (GST)||100|
|Product Price Exclusive of GST (5%)||Calculation Bifurcation||Subtotal|
|100||100 (base price) + 5 (GST)||105|
Seller Name & Signature in PDF
The GST invoice is required to have signature and name of the seller. To have both, we have added the facility to add name and upload the signature image in the backend to show in invoice PDF.
Apart from GST on Goods and Services, shipping is charged with GST as well. The shipping GST rate will be applied the same as GST on products. But in the case of multiple products, the rate with the highest GST will be considered for charging shipping GST. Just like products, shipping can be set inclusive or exclusive of GST.
Category & Product Specific GST
The extension also facilitates to set GST rate category and product specific. Means, you can set different GST rates for categories and products. And priority will be the first for products, then category and then global GST settings.
After configuring the extension properly, you can see GST getting applied on Magento store products. The whole GST system eases the task of Magento store owners by automating GST calculations in India.
Hope this blog will help you easily understand the concept of Indian GST calculations and its configuration in our Magento extension. If you want to automatically apply GST in your store, try our Magento GST India Extension. Let me know if you have more questions, additional features required or any suggestions through the comment section, I would be glad to help you out.