With GST tax coming into effect on 30th June 2017 the government along with the help of other stakeholders has setup a GSTN or goods and service tax network. GSTN is formed with the purpose of providing IT support and IT infrastructure to all the stakeholders involved. Government of Inia holds 24.5%, other states and UT hold 24.55 and private players hold 51% in this. GSTN is a nonprofit making body solely made for IT infrastructure development and helping in implementation of GST tax. In this basics of GST series article, we have a look at GST Suvidha Providers and try to understand it.
GST Suvidha Providers (GSPs)
GST Suvidha providers have been setup by these GSTN under the GST tax system. These GST Suvidha Provider will have a license to develop third party apps and other interfaces that may benefit customers. To become a part of GST Suvidha provider you need to get a license from GSTN team. We have discussed the eligibility criteria to become a GST Suvidha provider below. But first let’s have a look at the GST Suvidha provider ecosystem.
GST Suvidha Provider Ecosystem
GST Suvidha provider ecosystem is simple ecosystem where taxpayer is free to choose any service provider. Each GSP can provide multiple ASP or application provider. Taxpayer can choose one Service provider for GST registration and another for GST filing. GST Suvidha provider makes it easier for customer to get GST tax compliant and avoids monopoly of any one player in the market.
GST Suvidha provider ecosystem
Eligibility Criteria for GST Service Provider License
There is a list of sectors to which a company must belong to be eligible for GST Suvidha Provider License. Company must be registered in banking, IT, IT enabled services, financial and insurance services. There is a contract which has to be agreed upon along with GSTN. Then a license key is provided with access to GST data. There are two batches of license.
Eligibility Criteria for GSP License: Batch 1
Following is the eligibility criteria :
Financial Strength
- Should have paid up capital or raised capital of Rs 5 crores
- Should have turnover of Rs 10 crore for previous 3 financial years
Capabilities to be demonstrated
- UI / UX
- E-sign / DSC integration for signing of return
- Security design
- GST Return, preparation and filing
- GSTR 2 reconciliation with register
- Invoice upload by tax payers
- Multiple mapping of roles to 1 GSTIN
- Multiple GSTIN I mapping to a single user account
- Mobile interface
- Alert generation to tax payers
Technical Capabilities
- Backend IT infra work for backend like servers and databases have to be setup and maintained in India
- IT infrastructure that can handle 1 lakh minimum, transactions per month
- Privacy policy related to data
- Showing data security measures capability as it has been stated in IT act
GSP License: Batch 2 – Eligibility Criteria
Following the onboarding of the first Batch of GST Suvidha Providers, the GSTN relaxed the eligibility criteria and invited the second batch. The revised eligibility criteria is as under:
Financial Strength
- Should have paid up or raise capital of at least 2 crores
- Average Turnover for previous 3 financial years should be 5 crores
Demonstration of Capabilities
- UI / UX
- E-sign / DSC integration for signing of return
- Security design
- GST Return, preparation and filing
- GSTR 2 reconciliation with register
- Invoice upload by tax payers
- Multiple mapping of roles to 1 GSTIN
- Multiple GSTIN I mapping to a single user account
- Mobile interface
- Alert generation to tax payers
- Technical capability in terms of handling large traffic, infra for same etc
Technical Capabilities
- Backend IT infra work for backend like servers and databases have to be setup and maintained in India
- IT infrastructure that can handle 1 lakh minimum, transactions per month
- Privacy policy related to data
- Showing data security measures capability as it has been stated in IT act
For reading and learning more about gst tax you can check out our basics of GST series. In case of any help regarding GST tax you can contact The Buzz Stand Team.
