GST implementation has hit every industry of the country. The professionals are no exception either as they have been hit by the impact of GST as well. Before the implementation of GST, professionals had the benefits of service tax registration which is centralized. Once the implementation of GST has come to effect, the professionals who are operating from multi locations will have to register for GST.
The compliance requirement for the professionals will also go high with the implementation of GST. Earlier according to the erstwhile tax, the professionals filed half yearly tax returns.
However, with the implementation of GST, now they would have to submit monthly GST returns. Additionally, the professionals working as individual or partnership firm that doing with the option of quarterly tax would have to pay for the extra working capital.
The government has offered a scheme for small manufacturers and traders which are up to ₹ 75 Lakh of annual turnover. Such benefit does not exist for the working professionals who are into service providing.
The tax rate has gone up to 18% under GST. However, some good news is there for the professional service providers. The professionals would be entitled to higher ITC that input tax credit.
The place of supply is another matter of question for the professional service providers. What place of supply signifies is not clear under service tax. However, they would have to change the IT system to track the place of supply. Apart from these compliances, the professionals would have to pay reverse charge provision as well.