GST Preparation Guide for Tax Consultants

Goods and Services Tax (GST) is just around the corner, scheduled to be implemented from July 1, 2017. It will have a far-reaching impact on the entire indirect tax regime, from the nature of levy and tax rates to the administration of the taxes. Although the GST aims to simplify the whole indirect taxation process, there exist certain procedural lacunae during the transition period that can jeopardize the entire change-management process. Thus, the purpose of this article is to examine the various ways tax practitioners are gearing up for GST India.

GST India will usher in various regulatory changes and affect how definitions are perceived by taxation authorities vis-à-vis taxpayers. The role of tax professionals is vital here to ensure that interpretation of the GST regulation is in sync with the real substance of the GST law. Also, the introduction of GST in India opens up a new horizon for Big 4 firms. It is imperative that such practitioners keep their advisory knowledge up-to-date in the current dynamic environment, so as to help clients mitigate any issues relating to business impact assessment that arise from the implementation of GST,. Tax practitioners will also be expected to represent clients’ concerns before the appropriate authority.

With the advent of GST, the entire gamut of accounting codes and guidelines will need to be revamped to be in sync with the regulation of GST. A modification of this magnitude will pose a severe challenge to commercial enterprises and individuals, who will have to re-establish entire operations from scratch.  Yet this also provides tax professionals the chance to integrate the correct business processes in IT, as well as in the accounting infrastructure domain, by automating every step: registration, business assessment, invoice reconciliation, returns preparation and filing, etc. Tax practitioners with expertise in GST are the ideal professionals to manage this transition. Their inputs will be invaluable when it’s time to choose fintech vendors who are certified GST Suvidha Providers (GSP), along with experienced Application Service Providers (ASP).

This is where the tricky part comes in. Tax professionals will be expected to anticipate any problems that may arise in the industry and carve-out strategies to counter bottlenecks. Like any other financial consultancy, any planning that mitigates the tax cost will be greatly valued by individuals and corporates alike. It is worth noting that GST is a destination-based tax rather than origin-based tax as per existing laws; businesses will be required to reconfigure the existing transaction methodology in order to minimize the tax burden, and this will require the services of tax professionals.

The industry will likely need assistance in registration as well as maintenance of tax records under the GST; a business entity would be unwise to approach filing/completion of requisite forms and documents without the aid of a professional. Similarly, the tax practitioners of GST India will likely be called upon by clients to streamline vendors’ supply chains, to ensure large eCommerce enterprises as well as manufacturing sectors are GST compliant. Tax practitioners, with their broad knowledge in the GST, should be able to address any doubts or grievances that a business entity may have.

Implementation of GST will likely lead to an increase in the training requirements of the industry and for the industry. Such training sessions would entail guiding the top-level management of the firms, the managers at the process-level, and the finance/taxation department. Tax practitioners are required to be at the vanguard of the implementation of training modules for their clients.

GST India is going to be a complicated affair for every stakeholder at every stage of the vertical. Nonetheless, tax practitioners with expertise in GST can help smoothen out the entire regulatory procedure, as well as assist clients in setting up the infrastructure needed to guide their operations. Additionally, tax practitioners can assist in solving litigation arising from the transition to GST, and also provide advisory queries for companies and individuals. Consequently, the GST in India provides new avenues for tax professionals to assist clients at every step of GST.

Avalara is a seasoned Application Service Provider (ASP) to multiple GSPs for GST compliance solution, i.e., multistate returns preparation and filing. To learn more about how Avalara can help you with GST automation, contact us through https://www.avalara.com/in/products/gst-returns-filing

This blog is contributed by Vatsal Bhandari, financial and legal consultant at Gurgaon.