GST Calculator

GST Exclusive GST Inclusive

GST Calculator

Goods and Services Tax (GST) is an indirect tax system implemented in India to replace multiple cascading taxes levied by the central and state governments. It is a comprehensive, multi-stage, destination-based tax applied on every value addition.

To calculate GST, you need to understand the tax components under GST, GST calculation formula, and use a GST calculator for ease of computation. In this guide, we'll understand everything about GST calculators to help you correctly compute GST on goods and services.

What is GST

GST or Goods and Services Tax is an indirect tax regime introduced in India from 1st July 2017. It replaced multiple indirect taxes levied on goods and services by the Indian Central and State governments.

GST unified the indirect tax system in India by subsuming nearly all indirect taxes like excise duty, VAT, service tax, entry tax, etc. It is levied on every value addition and aims to avoid cascading of taxes i.e. avoid tax on tax.

GST is levied on the supply of goods and services right from manufacturing to the final sale to consumers. Credit for taxes paid on inputs at every stage of production can be availed for paying output GST.

What are Different Tax Components Under GST?

There are 3 tax components under GST:

• CGST (Central Goods and Services Tax): This tax is collected by the Central Government on intra-state supplies (transactions within the same state). It forms one part of the GST, and the revenue goes to the central government.
• SGST (State Goods and Services Tax): SGST is the state-level counterpart of CGST. It's levied on intra-state supplies as well but is collected by the respective state government. The revenue generated from SGST stays within the state.
• IGST (Integrated Goods and Services Tax): IGST is imposed on inter-state supplies (transactions between different states). This tax ensures seamless movement of goods and services across state borders. The revenue from IGST is shared between the central and state governments.

In addition, certain goods attract an additional cess tax over and above the GST rates.

What is GST Calculator?

GST calculator is a tool that helps quick and error-free computation of Goods and Services Tax on a transaction. It is an online tool available on various websites including government and private portals.

The user needs to enter details like:

• Invoice value
• Applicable tax rates (or GST bracket like 5%, 12%, 18% etc)
• HSN code in some cases

Based on this data, the calculator computes GST payable by breaking it up into CGST, SGST & IGST automatically. Some GST calculators also allow you to factor in previous input taxes paid

GST calculators are very handy tools for quick and accurate calculation of GST liability on transactions without any manual errors. They are designed considering varied users like taxpayers, accountants, businesses etc.

How to Calculate GST?

GST calculation involves identifying applicable tax rates, applying those rates on the taxable value and computing state-wise and central GST components. The steps are:

Step 1: Identify whether the product or service attracts GST or is exempted. Also identify the applicable tax slab - 0%, 5%, 12%, 18% or 28%.

Step 2: Determine the taxable value. If it is a product, assess the net price of goods charged. If it is a service, ascertain the net value charged.

Step 3: Apply the GST rate slab to the taxable value and calculate the total GST amount payable.

Step 4: Divide the total GST into CGST, SGST equally if it is an intra-state supply or as IGST if it is an inter-state supply.

Step 5: Add any applicable cess over and above GST on certain goods like aerated drinks, luxury cars etc.

Let us understand GST calculation with an example:

Raj sold goods worth ₹100,000 to a dealer in Maharashtra. GST rate applicable on the product is 18%.

Taxable value = ₹100,000

CGST = SGST = 18% of 100,000 = ₹18,000

Total GST = CGST + SGST = 18,000 + 18,000 = ₹36,000

So the total GST payable on ₹100,000 is ₹36,000

GST Calculation Formula

The formula to manually calculate overall GST liability is:

Total GST = (Taxable Value x GST Rate in %) + Cess (if applicable)

Total GST = CGST + SGST (for intra-state supply) or IGST (for inter-state supply)

CGST = SGST = (Taxable Value x GST Rate / 2)

IGST = Taxable Value x GST Rate

Let's understand this further for products and services:

Calculation Formula for Goods:

Taxable Value: Higher of transaction value or MRP

CGST = SGST = (Taxable value x GST rate applicable / 2)

Total GST = CGST + SGST + Cess (if applicable)

Calculation Formula for Services:

Taxable Value: Invoice value or value determined as per Point of Taxation of Services

CGST = SGST = (Taxable value x GST rate applicable / 2)

Total GST = CGST + SGST + Cess (if applicable)

How to Use IIFL GST Calculator?

IIFL GST calculator is a useful tool to calculate your total GST liability in a simplified manner.

Follow these steps to use IIFL's GST calculator:

• Open the GST calculator page on IIFL's website
• Enter the invoice amount say ₹1,00,000
• Select the applicable GST rate from the drop-down list - 0%, 5%, 12%, 18% or 28%
• The tool will automatically calculate the CGST, SGST and total GST amount
• You can also enter previous input credit available for the transaction
• The GST calculator will show net GST payable after deducting the input tax credit
• You can also download the GST calculations in PDF format

Using this GST calculator, you can easily compute GST hassle-free without any manual errors. This helps you determine the correct GST liability on your sales/purchases.

Advantages of GST Calculator

Here are some useful benefits of using online GST calculator:

• Quick Computation: An online GST calculator swiftly calculates CGST, SGST, IGST, and cess, saving you from the complexities of manual calculations. It's a time-saver.
• Error Free: By automatically updating rates and applicability, it reduces the chances of human errors in tax calculations, ensuring accuracy.
• Tax Analysis: The calculator helps users analyze and plan taxes more effectively by providing downloadable reports for better financial decision-making.
• User Convenience: Accessible 24/7 from any device, it offers the convenience of on-the-go tax calculations, making it accessible whenever and wherever you need it.
• Time Saving: It's incredibly time-efficient. You can input basic details, and within seconds, it computes your taxes accurately, making your life easier.
• Updated Rates: Online calculators are synchronized with the latest GST rate changes for various goods and services, ensuring that your calculations are always up-to-date.
• Simplified Understanding: The step-by-step approach in these calculators helps users understand the intricacies of GST computation, fostering better knowledge of GST applicability over time.

GST calculators make life simpler for all users that need to deal with GST - right from taxpayers, tax practitioners, consultants, accountants to large enterprises. It supports better decision making and planning around taxes.