GST Account Assistant

Contents
• Valuation
– Consideration
– Valuation in case of non monetary consideration
– Discount vs. Bad Debts
– Third Party Consideration
– Relationship between COGS and Transaction Value
– Assessable Value
– Valuation of free supplies
– Valuation of Customs vs Valuation for IGST
– Stock Transfer
– Gift vs. CSR
– Case Studies on calculation of Assessable Value
 RATE OF TAX ON GOODS
• Nil Rate
– for vegetable, fruits, live stock etc
• 3% Rate
– (Natural or cultured pearls, precious or semi-
precious stones, precious metals, metals clad with
precious metal, and articles thereof; imitation
jewellery; coin
 RATE OF TAX ON GOODS
• 5% Rate
– edible oil,sugar,spices, tea, coffee (except instant)
Coal (instead of current 11.69%) Mishti/Mithai
(Indian Sweets) Life-saving drugs
 RATE OF TAX ON GOODS
• 12% Rate
– Computers, Processed food
• 18% Rate
– hair oil, toothpaste and soaps, Capital goods and
industrial intermediaries.
 RATE OF TAX ON GOODS
• 28% Rate
– Small cars (+1% or 3% cess) Consumer durables
such as AC and fridge Luxury & sin items like
BMWs, cigarettes and aerated drinks (+15% cess)
High-end motorcycles (+15% cess) Beedis are NOT
included here
 RATE OF TAX ON SERVICES
• 5% Rate
– transport of goods & passengers, leasing of air
craft, space for Advt
• 12% Rate
– Construction(No ITC), food in restaurant without
AC, Guest house, IPR,
 RATE OF TAX ON SERVICES
• 18% Rate
– food in AC restaurant, out door catering, renting of
convention centre / club /pandal shamiana with
food facility, Construction(with ITC)
• 28% Rate
– admission to entertainment events, race club,
Supply of Food/drinks in air-conditioned
restaurant in 5-star.
 Section 2(28): Consideration
• the new definition reads as follows:
Consideration in relation to the supply of goods or services includes 
(a) any payment made or to be made, whether in money or otherwise, in
respect of, in response to, or for the inducement of, the supply of goods or
services, whether by the recipient or by any other person but shall not include
any subsidy given by the Central Government or a State Government; 

(b) the monetary value of any act or forbearance, whether or not voluntary, in
respect of, in response to, or for the inducement of, the supply of goods or
services, whether by the recipient or by any other person but shall not include
any subsidy given by the Central Government or a State Government: 
PROVIDED that a deposit, whether refundable or not, given in respect of the
supply of goods or services shall not be considered as payment made for the
supply unless the supplier applies the deposit as consideration for the supply;
 Valuation of supply under GST 
• GST will be charged on the ‘transaction value’. Transaction value is the price
actually paid (or payable) for the supply of goods/services between un-related
parties (i.e., price is the sole consideration)

• The value of supply under GST shall include:

• Any taxes, duties, cess, fees and charges levied under any act, except GST. GST
Compensation Cess will be excluded if charged separately by the supplier.
• Any amount that the supplier is liable to pay which has been incurred by the
recipient and is not included in the price.
• The value will include all incidental expenses in relation to sale such as
packing, commission etc.
• Subsidies linked to supply, except Government subsidies will be included.
• Interest/late fee/penalty for delayed payment of consideration will be
included.
 Example
• Let us consider an example of ABC, a manufacturer, selling tools
and hardwares like drills, polishers, spades etc. It sells a power drill to
XYZ a wholesaler. The MRP is Rs. 5,500 but ABC sells it for Rs. 3,000.
 Discounts

Discounts will be treated differently under GST.

Discounts given before or at the time of supply
will be allowed as deduction from transaction
value. Discounts given after supply will be
allowed only if certain conditions are satisfied.