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GST Tool for Builders and Contractors


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An exhaustive one step solution for builder or a works contractor to migrate to GST. An excel-based tool which facilitates the calculations of project profitability, the effect of anti-profiteering clause on us and on our vendors, back calculation of sales price from targeted profit in current regime vs in GST regime, loss/profit potential of the individual project and many more useful features. It contains the facility of multi GST implementation date and ease of use.

Published in: Law
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GST Tool for Builders and Contractors

  1. 1. GST BUILDERGST impact assessment and Decision Simulator Builders Real Estate Developers Contractors All types of On - going Projects
  2. 2. Why On-going Projects
  3. 3. GST Impact - ON-GOING PROJECTS GST Impact Analysis is normally done on the historical data + existing business flows. However, in case of on-going projects some additional homework is required:- GST CAN BE FAVOURABLE OR UN-FAVOURABLE DEPENDING ON EACH OF THE ABOVE FACTORS 1. Assess Project Completion %age 2. Forecast future projections for the balance portion 3. Identify “indirect taxes” in projections 4. Compare the “GST credit benefit” vs “Current Lapsed indirect taxes” 5. Strategize the future collections 6. Negotiation strategy with customers 7. Sub-contracting review and the possible rate revisions 8. Working Capital Impact
  4. 4. Customs CVD & SAD Excise VAT/ CST Excise VAT/ CST Service Tax Illustrative Impact to Real Estate Sector Import of material Domestic Material Capital Goods Supply of Services VAT Service Tax Stamp Duty Current Regime
  5. 5. Customs IGST CGST + SGST IGST CGST + SGST IGST CGST + SGST Illustrative Impact to Real Estate Sector Import of material Domestic Material Capital Goods CGST SGST Stamp Duty GST Regime IGST Supply of Services
  6. 6. Product Features
  7. 7. Key Features GST BUILDER Inbuilt tax complexities Project-wise Prot analysis Pre-GST and Post-GST Real-time push of updates in GST by central team Pre-dened transactions mapped to taxes - Pre and Post GST User interface to add new transactions, taxes to assess impact Pre-determined credit eligibilities Pre GST to carve out the hidden tax inefciencies
  8. 8. Sub-contractors Module Collections Module Inventory Transitional Provision Module Vendor/ Contractors Negotiation Module Special Modules Analytics Income report Tax Credit Comparison Tax Liability Comparison Tax Code Wise GST Impact Report GST BUILDER
  9. 9. Decision Simulator Technology Sales Price determination Multiple GST Roll out dates Discounts from vendors/ contractors Changes in timing of projections MS excel based product “Best in class” user experience Transaction data hosted locally Online tax masters GST BUILDER
  10. 10. PRODUCT Functionality
  11. 11. INPUT VALIDATION LAYER LOGICAL LAYER OUTPUT Basic configurations Historic Project data Forecasted Project data Method of valuation opted under VAT and ST Collection details and tax exempt amounts Validation of pre-defined and auto populated Masters Align existing accounting with Chart of accounts Ensure accurate assignment of old taxes with Chart of accounts Ensure correct mapping of GST taxes with Chart of accounts Carve out tax inefficiencies recorded as costs in current regime Identify eligible credits under both regimes Determine the tax liability under both regimes Determine tax impact on profit before and after GST Project profitability comparison Drill down reports Business Simulations Changes to tax rates and GST roll out dates
  12. 12. Basic Configuration For New Project A unique project ID will be created based on the above selection. All Masters are defined for each of the above combinations. Category Project Name State Client Tax scheme combination Input Details Name Name Type - Developer or contractor. Applicability of VAT and service tax. Need for Defining Project Level and not Company Level Complex and varying state taxes Varying business models Multiple combinations under VAT and Service Tax Existing Constraint N.A. Lack of expertise Multiple transactions Rigid Structures Our Expertise N.A. Multi State Tax Experts on our panel Experience of tax optimisations for all types of clients Simplification of tax positions
  13. 13. Category Input Details Need for Defining Existing Constraint Our expertise Category 1 Category 2 Tax elements Tax code Nature Exhaustive transactions lists Taxes and rates Combination of tax elements Macro Analysis Lack of Standardisation Multiple Indirect Taxes Series of Combinations N.A. Time Consuming Constant changes Innumerable theoretical options N.A. Industry specific nomenclature State wise updated tax repository Concise and Practical Options shortlisted
  14. 14. Category Input Details Need for Defining Existing Constraint Our expertise Chart of accounts Inclusive/ Exclusive Credit Eligibility Trader margin Standard Labour deduction rate Tax codes assignment Accounting Perspective 0 – 100% % of trader margin. % of Labour element One to One mapping Identifying hidden taxes Profit Impact Assessment Cascading of Taxes Aspect Theory Chances of Errors Lack of user awareness No stable formula across the country Unknown factor Complex Interplay of Multiple Factors Pre-defined mappings Pre-defined modifiable mappings Pre-defined modifiable mappings Accuracy Pre-built
  15. 15. Project profitability under Old Regime Remove all hidden taxes Determine the basic values Calculate trader margins in determining excise transfer from trader Adjustment for labour cost under WCT Tax Credit positions earmarked Arrive at the project profitability based on past and forecasted data for current regime Project profitability under GST Regime Adjustment Factors Collections from customers - forecasted, exempted collections Sub-contractor Deductions Vendors discounts post GST Transitional provisions under GST Supplies without consideration Blocked Credits LOGICAL LAYER Assign CGST, SGST and IGST to chart of accounts Apply GST rate on basic cost determined above Split the forecasted value based on the GST rollout date in pre- GST and post-GST forecast. Calculate the taxes and profit impact under Current regime for "Pre-GST" forecasted values Calculate the taxes and profit impact under GST regime for "Post-GST" forecasted values Calculate the project profitability based on past data and forecast under GST regime
  16. 16. Reports And Simulations Data Level Reports: Chart of accounts with basic price with taxes calculated under both regimes Summary of Tax Credits under both regimes Summary of Tax Liabilities under both regimes Transitionary provisions impact Analytical Reports: Project profitability comparison Monthly cash flow comparison Tax code level comparison [Old tax code and GST] Simulations: Determination of sales price by maintaining the same profit GST impact with change in GST roll out date Changes to Discounts of vendors/ contractors Change in timing of projections
  17. 17. Additional user @ Rs. 5,000 plus ST * Service tax at actuals Users – No. of machines for installations Projects range – No. of projects for GST impact assessment **One developer/ contractor may have multiple projects. Each project needs to be purchased separately. Without Sensitivity Analysis With Sensitivity Analysis Projects** Standard* Rs. Per Project Premium* Rs. Per Project 1 2 4 1-4 5-10 11+ Projects 29,500 26,500 23,500 35,500 32,000 28,500 No. of users User
  18. 18. License based product License restricted to number of projects created License restricted number of users Usage restricted to the MAC ID of desktop/ laptop where license is activated Restrictions on change iterations to base data Masters are hosted online and pulled one time for offline use Highest security to logical layer source code
  19. 19. PRODUCT Screenshots Actual product may slightly vary from the screenshots.
  20. 20. Configure Project
  21. 21. Map Your Financials
  22. 22. Input Process – Financials
  23. 23. Input Process – Projections Break Up
  24. 24. Input Process – Tax Positions
  25. 25. Input Process – Mapping All Masters
  26. 26. Compute TAX
  27. 27. Sample Report – Impact of Anti-Profiteering Clause on Basic Pricing
  28. 28. Masters Management
  29. 29. Sensitivity Analysis
  30. 30. WHO WE ARE?
  31. 31. www. www.sciffer.comwww. Technology PartnerDeveloped by