Advance received under new GST provisions
As the Goods and Service tax Act is now employed by the government, we have seen many changes under these changed laws. Today, we go into the depth of it through this article in which we will discuss about the advance received with respect to time of supply, related exemptions, advanced received with respect to GST return, advance under GST and advance received with respect to change in rate.
The Goods and service Tax Act is a very enhanced and complete Act in which several provisions are available related to the various goods and service. This Act helps producers in implementing their strategies in a correct manner in order to earn profits and avoid loses.
Time of Supply factor
To know about the exact time of tax payment, one has to know about the laws regarding the time of supply factor. The clauses are written under Section 12 of the Central Goods and Service Tax Act, 2017.
Section 12 (2) of the Central Goods and Service Tax Act, 2017 states that the time of supply of goods should be either date of circulation of invoice or the date on which the supplier gets the payment. The earlier one will be preferred.
The time of supply with respect to advance received would be the date on which the supplier gets the payment.
Exemption from paying the tax with respect to advance received
The exemption from paying the tax with respect to advance under GST has been issued by the government as vide notification no. 66/2017, Central Tax dated 15th November, 2017. The important pointers of this notification are given below:
- Any certified person will pay central tax on the outward supply of goods at the time of supply as per section 12 (2) (a) of the Central Goods and Service Tax Act, 2017 that is date of issue of the invoice of the supplier.
- The above exemption is also applied with the provisions of section 14 of the same Act that is change in the rate of tax in respect of the supply of goods and services.
- If composition scheme is opted under section 10, then such exemption would not be given.
These mention exemptions are available in case of supply of goods and is unavailable for supply of services.
Goods And Service Tax Return with respect to advance received
The information about the advanced amount received should be entered in S.NO 11A of the GSTR – 1 return. It shows the numbers of advance received within the tax period for which the invoice has not been given (tax amount should be added to output tax liability).
The numbers written in the S.NO 11A of the GSTR – 1 return should be bisected into 2 parts that is advance received against inter-state stocks and advances received against intra-state stocks. Consolidated figures should be written in the same way. Other related details could be skipped.
The total figure of the advance amount received needs to be written in the head part known as ‘Gross Advance Received / Adjusted’. The inter-related tax liability should be written in the ‘integrated’ head in case of inter-state stocks and should be written in the ‘Central’ and ‘State/ UT’ head if the case is of intra-state stocks.
Advance Received with respect to change in rate
Following things should be kept in mind for finding the accurate rates as per the provisions of section 14 of the Central Goods and Service Tax Act, 2017.
- Supply of goods or services
- Date of invoice
- Date of pay
The table that is given below is beneficial for finding the tax rates and related situations:
| Dissemination of goods or services takes place before the development in rate | Invoice not issued but pay amount is received | Old rate |
| Dissemination of goods or services is completed after the development in rate | Invoice is not given but payment is received | New rate |
| Dissemination of goods or services is completed after the development in rate | Invoice is given and payment is also received | Old rate |
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