Once the GST rolled out, the business concerns rushed straight to synchronise their GST and accounting books in tune with the GST. This does mean that the cost will go up slightly for the infrastructure and the changes. In the case of large companies, they have set up their own technical expert, financial consultants, and consultants for software to deal with the GST software.
Good for the IT companies
The advantage of Accounting software GST for IT software companies become obvious when we see how the IT service providers can adjust the input taxes against the service provided. They can adjust VAT paid on office supplies also against the service provided. The cost of maintaining the server is huge for IT companies. They also have to spend on the hardware, repair, and maintenance. They can adjust the tax paid on the hardware against the tax paid on service and repair of small parts.
First essential need is the adaptability of the GST in the planning of resources to provide stability to the ERP system and guard against the collapse. The proposal of taxes must lie within the tax configuration and the computation. The vendor must verify the impact on interfaces for your own ERP or for a third party.
Interstate stock transfers, subcontracting, and all such business process refinements should lie within the GST framework. The system should have the flexibility of catering to the needs of the reporting and printing needs as per the regulatory restrictions. It should also provide the capacity for tax migration and for VAT, excise, and so on.
Prepare for GST first
If you get the best accounting software GST will not pose any problems. To be ready for GST the Enterprise Resource Planning vendors should anticipate the consequences in advance. Of course, it may not be possible to see everything but the one who remains prepared will be able to benefit the most. They should prepare the closure and reversal of partially opened transactions before migrating to the new system. You should make changes to the business environment without affecting or causing inconvenience to the customers.
Get the ERP ready
ERP professionals understand the needs of the business. The train the company employees and design the software to go along with the flow of the business. Side by side, they update the software. In this way, the ERP implementation occurs stage by stage. The contract payment remains spread out over a couple of years and the tax is also prepared accordingly. The tax on the IT sector attracts 18% tax and so the cost of these services will increase accordingly.
Freelancers who offer services such as app development, designing, website maintenance, and so on used to pay 15% tax. Now, this has gone up to 18% under the GST. There is a debate whether bloggers will have to pay tax. If so, they might have to register but no one knows for sure. Everyone is waiting for some clarification on the part of the GST council in this regard. On the whole, the IT sector will stand to gain since there we will see an overall profitability in the IT sector.