Quick summary
How GST transformed bookkeeping requirements for Indian businesses. What is now mandatory, how it differs from pre-GST practice, and what this means for your business.
What changed with GST
Before GST (pre-July 2017), Indian businesses maintained separate accounts for VAT, service tax, excise duty, and entry tax. Compliance was fragmented across multiple authorities. A bookkeeper needed to understand which taxes applied to which transactions and file returns with different departments.
GST replaced most indirect taxes with a single tax administered through the GSTN portal. This simplified the tax structure but dramatically increased the data granularity required in bookkeeping. Every transaction now needs an HSN/SAC code, GSTIN of counterparty, place of supply determination (IGST vs CGST+SGST), and invoice-level matching with GSTR-2B.
- Pre-GST: VAT (state-level), service tax (central), excise (central), entry tax. Different registers for each
- Post-GST: Single indirect tax with three components (CGST, SGST, IGST). One portal, one annual return per state registration.
- New requirement: HSN/SAC codes on every invoice (mandatory for B2B above ₹5 crore; recommended for all)
- New requirement: Monthly reconciliation of GSTR-2B (auto-populated purchase data) against purchase register
- New requirement: E-invoicing with IRN for B2B businesses above ₹5 crore turnover
- New requirement: GSTR-9 (annual return) and GSTR-9C (reconciliation certificate if >₹5 crore)
Frequently asked questions
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