Question 1

How do I document free samples and gifts given to customers?

Accepted Answer

Goods supplied genuinely free of cost to unrelated persons are not a supply, so no tax invoice is raised and no GST is charged; the movement is covered by a delivery challan marked as free samples. The cost is that input tax credit on those goods must be reversed. Two traps deserve care: gifts to related persons or between distinct GSTINs of the same PAN are taxable under Schedule I even without consideration, and promotional schemes like buy one get one are treated as a single price for two items, taxed normally with credit intact. Structure your Velachery promotions with this distinction in mind.

Question 2

How much time do I get to raise an invoice for services?

Accepted Answer

A tax invoice for services must be issued within thirty days from the date of supply of the service. For banks, insurers, financial institutions and NBFCs, the limit is forty-five days. Where services are supplied continuously, the invoice follows the contract: if the due date of payment is ascertainable, invoice on or before that date; if not, invoice when payment is received; and if payment is linked to completion of an event or milestone, invoice on or before its completion. Consultants and agencies that bill quarterly should check their contracts against these rules, since late invoicing defers nothing legally.

Question 3

How do I track the status of a grievance ticket or any ARN I have on the GST portal?

Accepted Answer

For grievance tickets, open selfservice.gstsystem.in and use Check Status by entering the ticket reference number; the screen shows whether it is open, under processing or resolved, with the resolution comments. For applications filed on the main portal, log in and use Services, then Track Application Status, choosing the module and entering the ARN, or open My Applications to see every application with its case detail folder, notices and replies in one place. Diarise every ARN the day it is generated, because reply windows run from portal timestamps. ChennaiGST maintains an ARN tracker for every client engagement.

Question 4

What is the difference between the electronic cash ledger and the electronic credit ledger?

Accepted Answer

The electronic cash ledger reflects actual money you have deposited through challans, plus TDS and TCS credits you have accepted; it can pay tax, interest, penalty, late fee and any other amount. The electronic credit ledger reflects input tax credit claimed through your returns, and it can be used only for paying output tax, never for interest, penalty or late fee. Both are visible under Services, then Ledgers, after login. Refund of an excess cash balance is possible, while credit is refundable only in specified cases such as exports and inverted duty structure.

Question 5

I have taken a house on rent and I am GST registered. Does reverse charge hit my house rent?

Accepted Answer

Only in defined situations. From 18 July 2022, renting of a residential dwelling to a registered person attracts 18 percent under reverse charge in the tenant's hands. However, where a registered proprietor rents the dwelling in a personal capacity for use as his own residence, and on his own account rather than for the business, the exemption applies and no tax arises. If a company takes a flat as a guest house or for employee accommodation, RCM applies, and note that ITC on such rent may face challenge as a personal consumption expense. Document the purpose of the tenancy in the rent agreement so the correct treatment is defensible.

Question 6

I declare income under Section 44ADA. Does that mean I am exempt from GST?

Accepted Answer

No, this is a common myth. Section 44ADA is a presumptive taxation scheme under the Income Tax Act that lets professionals declare fifty percent of gross receipts as income; it has nothing to do with GST. GST liability depends solely on aggregate turnover crossing the registration threshold and the nature of your supplies. In fact, the two departments now cross-match data, so gross receipts reported in your ITR and Form 26AS that exceed the GST turnover you declared are a known trigger for notices. Treat the two laws as parallel obligations, each with its own limits and filings.

Question 7

My customer in Mumbai asked me to deliver goods directly to his buyer in Velachery. How do I bill this?

Accepted Answer

This is a bill-to ship-to transaction under Section 10(1)(b). When goods are delivered to a third party on the instruction of your customer, the law deems your customer's principal place of business as the place of supply, not the actual delivery point. So you invoice the Mumbai customer with IGST even though the goods physically moved within Tamil Nadu, and the Mumbai customer raises a second invoice on the ultimate recipient in Velachery. Only one e-way bill is needed for the movement, generated by either party with both invoice legs captured. Wrongly billing the delivery-point state is a classic error that misplaces the credit chain entirely.

Question 8

Is GST payable on hostel or paying guest accommodation in Velachery?

Accepted Answer

A specific exemption effective 15 July 2024 covers accommodation services supplied at a value up to Rs.20,000 per person per month, provided the accommodation is supplied for a minimum continuous period of ninety days. Student hostels and working men's or women's PGs in Velachery charging within this limit for long stays are therefore exempt. Where the monthly charge exceeds Rs.20,000, or the stay is shorter than ninety days, the supply is taxable like ordinary accommodation. Operators should maintain stay records and agreements evidencing the duration, because the ninety-day condition is what officers test first during verification.

Question 9

What is the default place of supply rule for services within India?

Accepted Answer

Section 12(2) of the IGST Act sets the general rule for domestic services: if the recipient is registered, the place of supply is the recipient's location; if unregistered, it is the recipient's address on your records, and failing that, the supplier's own location. So a consultant in Velachery advising a registered company in Hyderabad charges IGST, while the same advice to a local walk-in individual attracts CGST plus SGST. This default yields only to the specific rules for immovable property, events, transportation, and a few other categories, so always check whether a specific rule captures your service before falling back on the general one.

Question 10

Where is the place of supply for services connected to a building or land?

Accepted Answer

Services directly relating to immovable property, including those of architects, interior decorators, engineers, surveyors, construction and works contract services, renting, and accommodation in hotels, are supplied where the property is located, under Section 12(3). The recipient's location and registration are irrelevant. So a Velachery architect designing a factory in Coimbatore charges CGST plus SGST of Tamil Nadu, but for a project in Kochi the place of supply is Kerala and IGST applies. For hotels, the state where the hotel stands is always the place of supply, which is why accommodation is invariably billed with that state's local taxes regardless of where the guest's business is registered.

Question 11

What details must a GST tax invoice compulsorily contain?

Accepted Answer

Rule 46 of the CGST Rules prescribes the mandatory contents: your name, address and GSTIN; a consecutive serial number not exceeding sixteen characters, unique for the financial year; the date of issue; the recipient's name, address and GSTIN if registered; the HSN or SAC code; description, quantity and unit; total and taxable value; any discount; the rate and amount of CGST, SGST or IGST shown separately; place of supply with the state name for inter-state supplies; a declaration where tax is payable on reverse charge; and signature or digital signature of the supplier. Missing fields make the invoice defective and can jeopardise your buyer's credit.

Question 12

How many digits of the HSN code must I print on my tax invoices?

Accepted Answer

Under Notification 78/2020 Central Tax, taxpayers with aggregate turnover up to Rs.5 crore in the preceding financial year must mention a 4-digit HSN code on all B2B tax invoices, though it is optional on B2C invoices. Taxpayers with turnover above Rs.5 crore must mention 6-digit HSN codes on every invoice, including B2C. Eight digits are required for specified goods such as certain chemicals and for export documentation. Services follow the same rule using SAC codes, which begin with 99. Printing truncated or wrong codes on invoices creates mismatches later, so set the codes correctly in your billing software once.

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