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While the Goods and Services Tax (GST) transformed India's indirect tax system, making it easy, GST compliance still remains the most complex process for small businesses. Small Businesses often find it difficult to understand the aspects of GST and be compliant with it. GST Suvidha Providers (GSPs) help simplify this process for businesses of all sizes. They provide end-to-end GST solutions to businesses and facilitate GST compliance by taxpayers. This guide explores GSP services, operational benefits, the difference between GSP and ASP, and the process of GST providers.
GSP stands for GST Suvidha Provider, a platform that helps taxpayers comply with GST regulations seamlessly. It enables businesses to complete GST-related processes such as registration, invoicing, and return filing through an interactive web-based system. ClearTax, an online tax filing platform, has been granted GSP status.
Here’s an example:
ABC Ltd, a multinational company, manages its operations using SAP ERP, where all purchase and sales records are maintained. At the end of each month, reports are generated and used for tax return preparation. These returns are then uploaded manually to the government’s GST portal.
To streamline this process, the government aims to create a single, automated workflow where ERP systems can directly integrate with the GST portal. This integration will enable businesses to handle all GST compliance tasks seamlessly through their existing software, reducing manual intervention and improving efficiency.
To obtain a GST Service Provider (GSP) license, a company must meet the following criteria:
Once these requirements are met, the company enters into a contract with GSTN. After the contract is established, a license key is generated, granting access to GST data.
The license key is issued in two batches, based on the following three factors:
| Criteria of eligibility | The financial strength of the company | Technical Capabilities | Demonstration of Capabilities |
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| GSP License Batch 1 |
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| GSP License Batch 2 |
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GST compliance system requires a high level of data synchronization. The GSP serves all the needs of the process, such as registration, uploading the details of invoices, etc.
From filing returns to making payments, the GST compliance processes can be very lengthy and time-consuming. The taxpayer might have to file as many as 37 returns every year to be compliant with GST. Some of the major functions of GST Suvidha Providers are -
An Application Service Provider (ASP) is a platform that helps taxpayers file their GST returns with the support of ASP partners. It offers end-to-end solutions for managing the purchase and sale of goods and services.
Need help with GST compliance or have any tax-related queries? Get in touch with our tax experts, who can make the process seamless for you, ensuring you can focus on your business operations. Book an online CA now!
A GST Suvidha Provider (GSP) is an authorized entity that helps taxpayers comply with GST regulations through specialized software solutions. GSPs offer services such as GST return filing, reconciliation, e-way bill generation, and other compliance-related tasks, making the process more efficient and user-friendly.
GSPs offer software solutions that streamline GST compliance by automating tasks like return filing, invoice generation, ITC reconciliation, and e-way bill management. These solutions help businesses maintain accuracy, reduce manual work, and stay compliant with GST regulations.
GSPs offers the following services:
The following companies must apply to become a GSP -
No, using a GSP for GST compliance is not mandatory. However, it can greatly simplify the process by ensuring accuracy, reducing manual effort, and improving efficiency in managing GST-related tasks.
Benefits of using a GSP include:
A GSP (GST Suvidha Provider) provides the APIs and infrastructure to connect with the GSTN, while an ASP (Application Service Provider) develops user-friendly applications that utilize these APIs for GST compliance services. In many cases, a single entity can function as both a GSP and an ASP.
