1. Country-Specific Features
  2. India Help Topics
  3. India Localization SuiteTax Engine
  4. Goods and Services Tax
  5. Setting Up India Goods and Services Tax
  6. Creating India GST Tax Rate Rules

Creating India GST Tax Rate Rules

The India Localization SuiteTax Engine SuiteApp uses India GST tax rate rules to calculate GST on sales and purchase transactions.

The SuiteApp selects the GST rule based on the HSN or SAC code you select for an item.

You can create a tax rate rule with a unique combination of the following details. However, you can't have both taxable and nontaxable rules with the same combination for the same period.

To enter a GST tax rate rule:

  1. Go to Setup > India Localization > GST Tax Rate Rules.

  2. Click New Tax Rate Rule.

  3. In the Subsidiary Registration Type field, select the subsidiary’s registration type.

  4. In the Available On field, select the type of transaction this rule applies to.

    • Purchase Transactions – If you select this, the Vendor Registration Type field becomes available.

    • Sales Transactions – If you select this, the Customer Registration Type field becomes available.

  5. In the Customer or Vendor Registration Type field, select the entity's registration type.

  6. In the HSN or SAC Code field, select the HSN or SAC code for this rule.

  7. In the GST Rate field, select the tax rate for this rule.

    Note:

    The Ineligible for ITC box is checked by default for Nil Rated or Exempted tax rates because you can't claim Input Tax Credit (ITC) on those.

  8. In the Classification of Supply field, select the classification. This field isn't available if the subsidiary registration type is SEZ.

    • Inter-State Supply – This type uses Integrated Goods & Services Tax (IGST). The tax rate matches the GST rate. You can see the tax code and rate in the Tax Code and Rate columns.

    • Intra-State Supply – This type uses Central GST (CGST), State GST (SGST), or Union Territory GST (UTGST). The tax rate and amount are split equally between SGST and CGST or UTGST. You can see the tax code and rate in the Tax Code and Rate columns.

      When you select intrastate supply, check any of the following boxes:

      • Within the State – Check this box if the supply is within the same state.

      • Within the Union Territory – Check this box if the supply is within the union territory.

  9. In the Effective From field, enter the date the tax rule starts.

  10. In the Valid Until field, enter the date the tax rule ends.

  11. Check the Taxable box if this rule is taxable.

  12. Check the Amount Based box if this rule depends on an amount range. In these rules, the HSN or SAC Code sets the tax rate based on the amount.

    1. In the From Amount and To Amount fields, enter the amount range.

  13. Check the Reverse Charge box if reverse charge applies. This box only becomes available for purchase transactions.

  14. Check the Ineligible for ITC box if this rule isn't eligible for ITC under GST. The tax amount gets added to the item's or expense's cost. If you check this box, the rule applies to purchase transactions.

  15. Check the Compensation Cess box to calculate Compensation Cess with this rule. GST Cess is based on the values in the following fields:

    1. Cess Rate Type – Select the GST Cess rate type from the following options:

      1. Percentage – This calculates GST Cess as a percentage.

      2. Quantity – This calculates GST Cess based on the rate per unit and the number of units.

      3. Percentage + Quantity – This calculates GST Cess using both the percentage and the rate per unit.

      4. Percentage or Quantity (Higher) – This uses whichever is higher: the percentage or the rate per unit.

    2. Cess% – Enter the cess percentage you want to use.

    3. Cess Rate Per Unit – Enter the cess rate per unit you want to use.

    4. Units – Select the units units you want to use.

  16. Click Save.

Related Topics

General Notices