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How to Calculate GST

How to Calculate GST Online?

Goods and Services Tax (GST)

GST (Goods and Services Tax) is one of the biggest indirect tax reform in India. GST was initiated on 1st July 2017. GST came up with single taxation system and replaced various other existing taxes such as VAT (Value Added Tax), Service Tax, Octroi, Excise duty, etc.

GST is levied on the manufacturing and selling of goods and services. Hence, GST registration becomes a very important process.

The supplier of goods with the annual turnover of rupees 40 lakh and the service provider with the annual turnover of rupees 20 lakh has to register themselves under GST. There are above 1.03 crores taxpayers who have registered themselves under GST. To know more about GST, please read our blog on - What is GST?

There are different forms of GST collected by the government, as mentioned below:

  • SGST (STate Goods and Services Tax)

  • CGST (Central Goods and Services Tax)

  • UTGST (Union Territory Goods  and Services Tax)

  • IGST (Integrated Goods and Services Tax)

Along with the unified taxation system, taxpayers can know the tax levied at different points for various goods and services under the GST regime. As well as he should be aware of the required charges while filing and also have the records of his gross and net profit, which can be easily done with Online GST calculator. So here in this article, we will understand the process to calculate accurate GST for filing.

GST Calculator India

Online Indian GST Calculator is used to calculate the amount which your product or service would cost after applying of GST. GST (Goods and Services Tax) is a common tax based on the VAT (Value Added Tax) principle which replaces several taxes in India. Goods and Services Tax are segregated in different slabs such as 0\\\\\\%, 5\\\\\\%, 12\\\\\\%, 18\\\\\\%, 28\\\\\\%.

How to Calculate GST Using Formula

GST calculator also helps a taxpayer to file the GST return with ease, below mentioned is the process to calculate GST Online.

  • Visit GST Calculator Online.

  • Enter the Net price of the goods/services.

  • Mention the rate slab (0\\\\\\%, 5\\\\\\%, 12\\\\\\%, 18\\\\\\%, 28\\\\\\%)

  • Submit once you enter the details, this will help you to know the gross price of the product.

GST Calculation Formula

  • The formula used while adding GST is given below.

    • Amount of GST Applicable = ( Original Cost of the Product x \\\\\\% GST rate)  / 100

    • Net Price = Cost of Good  + GST Applicable Amount. 

  • The formula while removing GST is given below. (reverse GST calculation formula)

    • Amount of GST = Original Cost - [Original Cost x {100/(100+GST\\\\\\%)}]

    • Net Price = Original Cost - GST Amount

Final Product pricing: Before and after GST

Earlier in the old taxation, the central government use to levy excise duty when goods were produced in a factory and the state governments use to charge VAT on it. With the introduction of GST, that pattern was eliminated. The GST is levied at the consumption end or when the final consumer buys the product or service. 

It was said that after the implementation of GST, a person would save Rs 320 every month, the tax rate has come down for 83 common used items. 

  • The GST rate has come down for daily household products such as soaps, shampoos, hair oil, toothpaste, etc. 

  • Wheat and rice have been exempt from tax.

  • The tax earlier on Milk powder was 6\\\\\\% which is now 5\\\\\\%.

  • Sugar confectionery is taxed at 18 percent post-GST, as against 21 percent in the earlier indirect tax regime.The tax rate on edible oil and sugar has come down to 5\\\\\\%, earlier which was 6\\\\\\%.

  • The rate slab for washing powder and tiles came down to 18\% which was earlier 28\%.

  • Furniture rate slab has came down to 5\\% - 18\%, earlier it was 12\% - 28\%.

Along with that, Indirect tax will be levied by the Central and State Government called Central GST (CGST) and State GST (SGST), respectively. If there are any intra-state transactions, the seller has to collect CGST and SGST from the buyer which will be paid to the Central and State Government. Below mentioned is an example of the impact of GST on product pricing.

Old tax system

New tax system

VAT at 10\% is Rs.100

CGST at 5\% is Rs.50 + SGST at 5\% is Rs.50

Cost of a product sold from Pune to Jaipur is Rs.1,100

Cost of a product sold from Pune to Jaipur is Rs.1,100

Profit is Rs.1,000

Profit is Rs.1,000

Selling Price isRs.2,100

Selling Price is Rs.2,100

CST at 10\% is Rs.210

IGST at 10\% is Rs.110

The total cost of the product is Rs.2,310

The total cost of the product is Rs.2,210

While calculating GST, it is necessary to get an accurate result, sometimes a small mistake cannot be recovered easily. So, here at LegalDocs, we provide a GST calculator which will help you to get the correct result within a couple of minutes. You can also consult with our experts in case you have any query regarding GST calculation.

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