How do I calculate GST?

GST can be calculated simply by multiplying the Taxable amount by GST rate. If CGST & SGST/UTGST is to be applied then CGST and SGST both amounts are half of the total GST amount.

GST = Taxable Amount  x  GST Rate

If you have the amount which is already including the GST then you can calculate the GST excluding amount by below formula

GST excluding amount = GST including amount/(1+ GST rate/100)

For example, GST including amount is Rs. 525 and GST rate is 5%.

GST excluding amount = 525/(1+5/100) = 525/1.05 = 500

GST is calculated on the transaction amount and not on the MRP.

Calculation of GST Amount payable to Government

A registered person needs to pay the difference of GST on sales and GST on purchases made in a month. The purchase may be of goods, services or capital goods.

Capital goods are those goods which you had NOT purchased for the purpose of reselling. For example – Furniture in your shop, machine for production etc.

For example, A person made intra-state sales of Rs. 1 lakh in January and collected CGST of Rs. 2,500 and SGST of Rs. 2,500 at the rate of 5%. In the same month, he had made purchases of Rs. 80,000 and paid CGST and SGST of Rs. 2,000 each at a rate of 5%. He had also paid a bill of internet of Rs. 1,000 plus GST of Rs. 180.

Rs. 4,180 is allowed as a deduction from the Gross tax payable of Rs. 5,000. And therefore a net of Rs. 820 is payable to the government.

Deduction of GST paid on the purchase of goods, services or capital goods is called input tax credit. There are certain limitations and restrictions on taking the input tax credit.

GST Rates

GST rates are as under

  • 0% (necessity items like milk, wheat flour)
  • 0.25% (rough diamonds)
  • 3%  (gold, silver etc.)
  • 5%
  • 12%
  • 18%
  • 28%

Most of the goods fall in the category of 5%, 12% and 18%, while most of the services fall in the category of 18%. GST of 28% is applicable on some items like cement, car, tobacco. There is also a Cess which is applicable only on a handful of goods like car, tobacco, pan masala.

There are also goods/services on which GST is applicable at NIL rate or which are exempted.

You can easily calculate GST amount using our GST Calculator.

Did You Know : Top 15 Free Online Learning Platforms

  1. Free Online Education Degrees : Coursera:

    Coursera partners with universities and organizations worldwide to offer a wide range of courses. While many courses are free, a fee is often required for certification.

  2. Free Online Education Degrees: edX:

    Founded by MIT and Harvard, edX offers high-quality courses from top universities and institutions around the world. Certificates are available for a fee.

  3. Free Online Education Degrees : Khan Academy:

    Khan Academy provides free educational content in various subjects, especially mathematics and science, using instructional videos and practice exercises.

  4. Free Online Education Degrees : Udacity:

    Udacity focuses on tech-related courses and nanodegree programs, offering free content as well as more in-depth paid programs.

  5. Free Online Education Degrees : MIT OpenCourseWare (OCW):

    MIT OCW provides a vast array of MIT's course content for free, covering a wide range of disciplines.

  6. Free Online Education Degrees : Harvard Extension School:

    Harvard Extension School offers a selection of free online courses. While some courses are free, others may require payment for a certificate.

  7. Free Online Education Degrees: Stanford Online:

    Stanford Online offers a variety of free courses in different disciplines, including computer science, engineering, and business.

  8. Best Free Online Courses : Carnegie Mellon Open Learning Initiative (OLI):

    OLI offers free online courses and resources designed to improve learning outcomes through research-based methodologies.

  9. Best Free Online Courses : FutureLearn:

    FutureLearn partners with universities and institutions to offer a diverse range of free online courses. Certificates are available for a fee.

  10. Best Free Online Courses: Alison:

    Alison offers a wide range of free online courses, including diploma and certificate programs, covering various subjects.

  11. Best Free Online Courses: Open Yale Courses:

    Yale University provides free access to a selection of introductory courses through Open Yale Courses.

  12. Best Free Online Courses : UC Berkeley Online:

    UC Berkeley offers free online courses on a variety of subjects, ranging from computer science to humanities.

  13. Best Free Online Courses : Google Digital Garage:

    Google Digital Garage provides free courses on digital skills, including online marketing, data analysis, and more.

  14. Best Free Online Courses : Codecademy:

    Codecademy offers free coding courses, interactive exercises, and coding projects to help individuals learn programming languages.

  15. Best Free Online Courses : LinkedIn Learning (formerly Lynda.com):

    LinkedIn Learning provides a variety of video courses on professional development, technology, and creative skills. It offers a free trial period.

Related Posts: