As new as the concept of Goods and Services Tax (GST), there are many questions related to it. One of the most prominent questions being - How is tax calculated with GST? Ask anyone about it, most people have no clue about. Even people living in cities like Bangalore, working in IT industries have no clue about this.
So, if you are one of them, let us help you with your GST calculation.
Before we go ahead with the GST calculation, we must know about the three types of GST that are applicable:
Central Goods and Services Tax (CGST) ‒ It is levied by the central government.
State Goods and Services Tax (SGST) ‒ It is levied by the state government.
Integrated Goods and Services Tax (IGST) ‒ It is levied by Central Government on inter-State supply of goods and services.
Now without further ado, here is how it is calculated.
Let us say that you are buying a jar pickles from a shop or marketplace, which is priced at Rs. 50;
So, it would be -
Selling price + CGST (6% of the selling price) + SGST (6% of the selling price) = total price.
Similarly, let us consider another scenario. For IGST, let us say that a jar of pickle from Bangalore is being sold in Mumbai.
So, it would be -
Selling price + IGST (12% of the selling price) = total price.
However, the percentage would depend on the tax rate of the goods or services as assigned in the GST slab. So, it would be different for different good. While, for some goods and services, GST tax rates are 0%. You can go through our article on the final GST slabs to know more about the different tax rates.
Well, now you know how GST is calculated. We hope that you found this article on the tax calculation with GST, helpful.
If you are looking for help regarding the tax calculations with GST in Bangalore, then you can get in touch with us.