The goods and services (GST) tax was introduced in 2017 to reduce indirect taxes levied on goods and services. Before GST was introduced, the complex taxation system made it particularly hard for medium and small sector enterprises and startups to sustain themselves. However, GST has simplified things greatly, so all businesses need to get GST verification. This can help companies get easy SME loans, save money, and reduce overall corruption in the system.
Read on to find out the benefits of getting GST verification for your business.
- It can streamline all taxes: Before GST, there were numerous taxes that businesses had to pay, such as luxury tax, central sales tax, etc. This made the process of paying taxes extremely complicated and expensive. However, you can spend all your taxes under one head with GST verification. For instance, earlier, a business had to get separate VAT registration in every state. This process was very time-consuming as every state functioned differently and followed a diverse method. But with GST verification, the need for VAT is eliminated.
- It can help you get a business loan: GST verification helps your business get a business loan without hassles. Banks and other lending institutions look for a GST invoice before sanctioning the SME loan, which allows them to establish faith in your company. GST also offers more transparency to the lender. In the absence of this document, the lender may reject your loan.
- It can help reduce taxes: Businesses with GST verification can benefit from the composition scheme. This scheme allows small businesses to pay GST at a fixed turnover rate. This way, companies with an annual turnover below Rs. 1.5 crore (Rs. 75 lakhs in the case of Himachal Pradesh and North-Eastern states) can choose composition schemes to lower their tax liability and avoid tiresome tax filing and compliance methods.
- It eases the process: GST verification can reduce lengthy paperwork. You can pay GST, request a refund, etc., online. There is no need to like a chartered accountant to file your taxes as the process is extremely straightforward and can be done by anybody. It is also simpler to keep track of your taxes and maintain records. This further simplifies the process of applying for a business loan, too, as you do not have to produce multiple documents to show as proof of your previous tax filings.
GST verification can be a boon to businesses in many ways. It brings uniformity and transparency and saves costs in the long run. You can use a business loan EMI calculator to understand exactly how much you protect each month. The shortened tax filing process lets you focus on more important aspects of your business and help it grow.
