Any discussion on the Goods and Services Tax is incomplete without an understanding of the GST Network or GSTN – the online platform for GST implementation and administration. It’s a non-profit organisation that manages the entire technology and IT infrastructure of the GST portal facilitating all GST operations. From the filing of returns to making payments, the Goods and Services Tax Network facilitates a harmonious and effective tax management system. Here we take a look at the GST Network, its role, purpose, and importance in facilitating seamless GST implementation.

What is GSTN?

We begin by understanding the meaning of GST Network or GSTN.

The full form of GSTN is Goods and Services Tax Network and it refers to the non-government online platform that manages the entire IT infrastructure for the GST portal.

• Role of GSTN: Acts as the IT backbone of the GST portal enabling taxpayer registrations, GST returns filings, and GST payments
• Purpose of GST Network: Simplifies tax management and makes tax information accessible for government and taxpayers
• Importance of GSTN: Enhances tax compliance through technology adoption and digital automation to gather real-time data, avoid tax evasion, and promote transparency

To know more about the Goods and Services Tax Network, visit the official website: //www.gstn.org.in/

What are the features of GST Network?

The GST Network is the technology backbone that monitors and manages the GST portal. It is a robust, technologically advanced portal that’s designed to make tracking transactions and relevant GST data easy and secure. Listed below are the key features of the GSTN platform that show the unique functionality and innovation of this portal:

• Unified portal: Single portal for all GST registration, payments, returns filings, and other transactions
• Robust IT infrastructure: A common, robust IT system for the Centre and States/UTs (E.g., instantaneously segregating GST allocation between Centre and States/UTs as recorded through IGST, CGST, SGST and UTGST collections)
• Extensive data security: Ensures data confidentiality and integrity through state-of-the-art security measures
• Real-time data processing: Manages data on financial transactions in real-time, ensures accurate recording and reporting, and facilitates prompt decision making (E.g., GSTR-2A as a dynamic view document that’s updated in real time as taxpayer updates GSTR-1 data)
• Structured reporting tools: Supports tax authorities with reports on tax compliance, audit and analysis to ensure there’s minimum non-compliance in GST obligations
• Hassle-free payments gateway: Facilitates all GST payment actions through integration with multiple payment channels (i.e., RBI approved agency banks), for a quick and effortless experience on the GST portal
• Data auto-population: Reduces manual entry time and errors, by auto-populating data based on GSTR input data (E.g., Auto populating data for GSTR-2A and GSTR-2B based on GSTR-1)
• ITC matching: Enables businesses to accurately claim Input Tax Credits by automatically matching data with corresponding invoices and supplier GSTRs
• Shared user charges expenses: The Centre and States/UT will split user charges equally, and each State will bear user charges based on the number of taxpayers in the respective state

What is the role and importance of GSTN?

It is undeniable that the GSTN plays a fundamental role in GST administration. It provides a secure, unified, platform that facilitates multiple actions transforming the tax management landscape in the country. Let’s understand the GSTN’s role and importance in GST administration.

• Centralised tax management: GSTN is the single platform that manages all GST related activities. It’s a common and shared platform for State and Central GST systems and simplifies tax collection and distribution, payments and refunds, GST return filings, and more for both the government and taxpayers.
• Enhances compliance: GSTN’s technology is built to identify anomalies, discrepancies and inaccuracies in the GST system. It can track and verify transactions promptly and trigger alerts in cases of mismatches and non-compliances. This enables GST authorities to scrutinise transactions and issue GST notices in cases of non-compliance, thereby reducing scope of tax evasion and frauds.
• Facilitates ITC claims and reconciliation: One of the greatest advantages of GST is that it reduces the burden of cascading taxes. Through the mechanism of Input Tax Credit, taxpayers can offset GST on taxes paid during purchases thereby lowering overall taxes. The GSTN platform automates and reconciles ITC data for all taxpayers, ensuring that businesses receive prompt and accurate tax credits. (E.g., GSTR-2B for a static view of ITC from sellers; and GSTR-9C as a reconciliation statement).

Also read: GSTN under PMLA Act – Addition of GSTN as the 26^th entity in the Prevention of Money Laundering Act

What are the functions of the GST Network?

Let us now take a look at the primary functions of the GST Network in India.

• Facilitates GST registrations: Provides a simple, standardised procedure for all businesses to register under GST (irrespective of the State/UT)
• Simplifies return filings: Provides the IT infrastructure and tools required to securely file GST returns electronically and easily (e.g., pre-filled forms, auto-populated data, auto-calculations, etc.)
• Processes tax payments: Integrated with RBI approved agency banks, to allow taxpayers to file returns/make payments through internet banking via their preferred bank
• Manages refunds: Tracks all taxpayer’s GST Appeals and refund claims, and supports timely refund allocations if applicable
• Ensures GST compliance: Triggers alerts for discrepancies, mismatched data, or any anomalies, thereby facilitating easy detection of non-compliance and smooth audits
• Matches ITC claims: Digitally matches seller’s invoice data with buyer’s data to ensure accurate ITC allocation and reduced claim errors
• Miscellaneous services: Offers the technology infrastructure required for supporting miscellaneous GST services for taxpayers (e.g., FAQs, tutorials, helpdesk, etc.)

In addition to these functions, you must explore these hidden functions of GSTN covered separately in a detailed guide.

What is the structure of GSTN?

Before we close the discussion on the Goods and Services Tax Network, let’s understand the structure of GSTN to comprehend how it manages the vast and complex tax system.

• Governance: Non-profit, non-government organisation
• Shareholding pattern: Central and State governments with 49% shares and the remaining 51% held by private financial institutions
• Authorised share capital: ₹10 crores

When it comes to the administration of GST successfully in the country, the technology and IT infrastructure provided by the GSTN acts as its backbone. It’s robust, secure, and high-end, ensuring smooth functioning of all GST operations. The GSTN network makes all GST activities, namely, registrations, return filing, payments and compliance, seamless. It promotes efficiency, fairness, and builds transparency in GST management overall.

*This article is for information only. For more details, please visit the official GST website. You can also consult with a GST practitioner or CA or tax consultant for professional advice.

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