Accounting solutions come out with GST-ready features

The Confederation of All India Traders (CAIT), the umbrella association for traders in the country has raised concerns about the impact on certain clauses of the Goods and Services Tax Law on small businesses. These businesses traditionally suffer from uneven cash flows but are largely compliant. If availability of input tax credit is linked to payment of tax by their supplier, it will worsen the situation for these small  businesses.

Says CAIT Secretary General Praveen Khandelwal: “The trading community and other small businesses will undoubtedly benefit from the single tax regime. However, the provisions in the law to do with input tax credit availability if not corrected will be detrimental to their survival."

Adds Bharat Goenka, MD, Tally solutions, the well known Indian financial and accounting software “There is no doubt that GST will be one of the great levelers in the market, and open out the Indian market for the businessman. There are however certain provisions in the model GST law that will destabilize the SME community in the country. There is a dire need to delink payment with the availability of input credit and GST is capable of providing that because it brings a lot of transparency being technology led thus giving tremendous security and protection against tax evasion.”

Earlier this year, Tally Solutions rolled out Release 5.5, the latest version of the its Tally ERP9 suites, with GST ready features for majority of Indian states. The ERP9 series is designed to empower businesses to be fully tax compliant, ensuring that tax returns reflect the books of helps businesses with simpler, easier and quicker compliance. Since its release in July 2015, Release 5 series has already been made available 24 States across the country.

Under proposed GST law, input credit against the taxes paid by the purchaser can be availed only if the seller deposits the said tax with Government treasury. In the event of non- compliance at the end of seller, it is the purchaser who will be denied input credit.

India has nearly 8 million registered businesses under the VAT regime, of which 90 percent are SMEs, and while GST will apply to all businesses with a turnover of Rs 20 lakh or more (Rs 10 lakh in case of NE states), It will be a tougher task for SMEs, compared to their larger counterparts, to move to the new regime, feels Bikky Khosla of SME Times.

He adds: "SMEs are facing an uphill task while getting ready for GST. Unlike their large counterparts, they lack financial muscles, but the new regime will require them -- besides getting down to the nitty-gritty of migrating to the new regime -- to invest in IT systems, engage more manpower to follow-up with suppliers, automate accounting and inventory management, and align their invoice according to the new prescribed rules."

Some product developers have responded to this pain of first-time SME compliers of GST, by creating easy to use accounting and tax reporting tools at affordable prices.

Last week Business solutions leader, Zoho launched a comprehensive suite of financial tools that will enable users particularly small businesses to meet the requirements of the new Goods and Services Tax. Called Zoho Finance Plus, it offers an end-to-end integrated cloud platform to manage corporate finances and operations, including filing of GST returns.

The Zoho Finance Plus suite includes:

● Zoho Books, the accounting and invoicing software or Zoho Invoice, the simple invoicing software for freelancers or businesses to get paid on time.

● Zoho Expense, an expense reporting solution tailor-made for businesses to automate their employee expense reimbursements.

● Zoho Subscriptions, a solution for subscription-based businesses to automate their recurring billing.

● Zoho Inventory, the perfect order management and fulfillment solution for retailers in India.

Says Sivaramakrishnan Iswaran, Director of Product Management, Zoho. “With Zoho Finance Plus, businesses get a beautiful interface to manage their transactions day to day and file their GST returns, all from a single platform. Zoho Finance Plus simplifies returns filing for businesses and increases compliance.”

In keeping with its policy to serve large numbers of small enterprises rather than a small number of high value customers, Zoho has compellingly priced the Finance Suite at Rs 2999 month for an organisation with 10 users, or Rs 19,999 per annum. Check out details here.

 If availability of input tax credit is linked to payment of tax by their supplier, it will worsen the situation for these small  businesses.