Tag: tax

Questions Related to tax

Journal entry for purchase of goods on credit within same state is follows:
Purchases A/c                     Dr
Input CGST A/c                   Dr
Input SGST A/c                   Dr
            To Creditor's A/c
State whether above entry is true or false.

civics introduction to gst fundamentals of gst tax journal

  1. True

  2. False

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Correct Option: A

Excess of input SGST after setting off the output SGST, can be utilised against output ________.

civics introduction to gst fundamentals of gst tax journal

  1. CGST

  2. SGST

  3. IGST

  4. none of these

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Correct Option: C

Identify the entry for sales return of goods that are sold on credit where the buyer and the seller are located in different states:

civics introduction to gst fundamentals of gst tax journal

  1. Sales Returns A/c Dr

    Output IGST A/c Dr

    To Debtors A/c

  2. Sales Returns A/c Dr

    Output CGST A/c Dr

    Output SGST A/c Dr

    To Debtors A/c

  3. Purchases A/c Dr

    Output IGST A/c Dr

    To Debtors A/c

  4. None of these.

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Correct Option: A

Input SGST can be used to set-off output CGST.

civics introduction to gst fundamentals of gst tax journal

  1. True

  2. False

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Correct Option: B

Input IGST is the only type of GST which can be used in setting off all types of output GST i.e., CGST, SGST and IGST.

civics introduction to gst fundamentals of gst tax journal

  1. True

  2. False

Show answer
Correct Option: A
Explanation:

True , IGST can be used in setting off all types of output GST.

Wef 1.2.2019, the Government has changed the order in which ITC of IGST, CGST & SGST/UTGST can be adjusted from the liability payable of IGST, CGST & SGST/UTGST. Now IGST has to be fully exhausted before other taxes can be utilised. 

What is the maximum rate prescribed under CGST?

civics introduction to gst fundamentals of gst tax journal

  1. 12%

  2. 28%

  3. 20%

  4. 18%

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Correct Option: C
Explanation:

CGST is an element of Goods and Service Tax. Central Goods and Service Tax has categories under Goods and Service Tax (CGST, IGST and SGST) with a concept of one tax one nation. CGST waterfall under Central Goods and Service Tax Act of 2016. 

As per section 9 (1) Subject to the supplies of sub-section (2), there shall be levy a tax called the innermost goods and services tax on all intra-State provisions of goods or services or both, apart from on the supply of intoxicating liquid for human consumption, on the value strong-minded under section 15 and at such rates, not exceeding twenty per cent  as may be notified by the Government on the recommendation of the assembly and together in such method as may be arranged and shall be waged by the taxable person.

Thus, the correct option is C.

When should a job-worker take registration?

civics introduction to gst fundamentals of gst tax journal

  1. Always

  2. Only if his aggregate turnover exceeds the threshold limits specified under Section 22 of the CGST Act, 2017

  3. Never

  4. None of the above

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Correct Option: B
Explanation:

As per Section 2(68) of the CGST Act, 2017, “Job work” means any treatment or process undertakes by a person on goods belonging to another registered person. 

The registered individual on whose goods (inputs or capital goods) job work is performed is called Principal as per section 143 of CGST Act. The registered principal may without the reward of tax sends inputs or capital goods to a Job worker for job work and if required from there then to another job worker.

 Once the conclusion of the job work principal shall either bring back the goods to the place of business or supply the same straight from the place of business/building of the Job worker. If input within 1 year and Capital goods within 3 years.

Thus, the correct option is B.

More MCQs on Foreign Exchange Management 1. The subsumption of which taxes will make the GST-a pucca Destination based Consumption Tax _________________.

civics introduction to gst fundamentals of gst tax journal

  1. CST and Central Excise

  2. VAT and Luxury Tax

  3. Service Tax and Purchase Tax

  4. Taxes on Lotteries and Entertainment Tax

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Correct Option: A

Which of the following is true in respect of events after the applicability of GST? Transitional Provisions 271 Indirect Taxes Committee _____________.

civics introduction to gst fundamentals of gst tax journal

  1. Proceedings under earlier law will be disposed of under the earlier law

  2. Any default due to proceedings in the earlier law will be recovered in the earlier law

  3. Proceedings under the earlier law will be disposed of under the new law

  4. Any refund due to the proceedings will be admissible as input tax credit

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Correct Option: A

What are the non-appealable orders or decisions in GST?
(i) File Transfer from authority to another
(ii) Order related to seizure or retention of books of accounts and other documents
(iii) Prosecution sanctioning order
(iv) Installment Order Codes.

civics introduction to gst fundamentals of gst tax journal

  1. i only

  2. i & iv only

  3. ii, iii & iv only

  4. i, ii, iii & iv

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Correct Option: D
Explanation:

Goods and Services Tax is an indirect tax used in India on the provider of goods and services. It is an inclusive, multistage, reason-based tax inclusive because it has subsumed approximately all the indirect taxes apart from a few state taxes. 

Multi-staged as it is, the GST is compulsory at each step in the manufacturing process, but is supposed to be refund to all party in a variety of stage of manufacture other than the final customer and as a purpose base tax, it is together from point of utilization and not point of origin like preceding taxes. 

Goods and services are separated into five dissimilar tax slabs for collected works of tax - 0%, 5%, 12%, 18% and 28%.

Thus, the correct option is D.