The much talked about GST implementation has become a reality. The Goods and Service Tax, a revolutionary and historic step in the Indian taxation system, is being heralded as the biggest tax reform in India. GST will add to the economic growth and bring simplicity in the way businesses operate by replacing existing Indirect taxes such as Excise, Value Added Tax (VAT), Service Tax, etc., into one taxation system. However, for businesses to continue to function smoothly, their ERP solution/ accounting software will have to be GST-ready.
Your ERP software must accommodate the following functions and modules to be GST-ready:
- Changes in the ‘Chart of Accounts’: Value Added Tax (VAT) and Service Tax required separate account codes in the old tax structure. However, GST requires that these account codes get merged. The GST-ready finance & accounting software would require the closing balance of tax credit to be carried forward to the new account codes, from the current account codes.
- Re-engineering of the Tax Rule Engine: The ‘Tax Rule Engine’ is a master repository containing all the tax rules including tax charge rates, tax compliance, tax jurisdiction and reporting. A GST-ready ERP solution would have completely re-engineered the Tax Rule Engine, incorporating the new data.
- Updating Master Data Information: GST has completely revamped the tax structure. Under the new structure, tax rates will change in regard to the charge of tax, place of supply of goods and services and time of supply. In accordance with these changes, your GST-ready accounting software should have all updated master data information such as Inventory, Warehouse Information, Customer’s Bill To and Ship To Addresses, etc.
- Installing new Reporting and Workflow systems: With the new GST framework in place, all existing workflow and reporting systems that cater to the earlier indirect tax regime will become redundant. The GST-ready ERP system should have new robust workflow systems to effectively manage the consolidation of taxes and ensure timely submission.
GST compliant accounting software is a prerequisite for organisations to ensure that they’re following GST norms. Apart from the above GST compliances, enterprises will benefit from a cloud-based ERP solution. ORION ERP from 3i Infotech is a scalable cloud platform that is GST-ready and can help take your enterprise into the new era of taxation.
- Real-time GST information validation
- Uploading, editing and generation of invoices as per GST guidelines
- Alerts/notifications from GSTN portal
- Filing compliances including registration to GST, e-filing, e-payment of taxes and digital signatures