Guide to Using Online GST Calculator for Accurate GST Estimates

Businesses often need to calculate their tax liability on their products or services for invoicing, budgeting, or other purposes. Doing math on a conventional calculator can be complicated and time-consuming. Thus, they need an online GST calculator to calculate their tax liability accurately. In this blog, we will learn how to use an online GST calculator and its business benefits. Before that, let’s understand the basics of Goods & Service Tax in India.

What is GST Exactly?

GST is an acronym for ‘Goods & Services Tax’, an indirect tax levied upon the supply of goods and services in India. In 2017, the GST was introduced to replace different indirect taxes levied in the country. These indirect taxes were Octroi, entry tax, VAT (value-added tax), and central excise duty.

GST came into effect to simplify indirect taxation and ease compliance for businesses. Whether you are a small or large business, all organizations must adhere to GST rules from 2017 onwards.

Different Types of Taxes Collected Under GST

Following are the different types of GST being collected by the government:

State GST (SGST) – Collected by the State Government

Central GST (CGST) – Collected by the Central Government

Integrated GST (IGST)—Collected by the central government on interstate imports and exports, it is later distributed to the states. This is inter-state, meaning in GST.

Union Territory GST (UTGST) – Collected by the government of the Union Territory

Formulae to Calculate GST Manually

Whether you are a manufacturer, wholesaler, retailer or any business, you can easily calculate GST with this below-mentioned formula:

• GST is exclusive of price 

GST Amount = (Value of supply x GST%)/100

Price to be charged = Value of supply + GST Amount

• GST is inclusive of price 

GST Amount = Value of supply – [Value of supply x {100/(100+GST%)}]

Understanding GST Calculation With Examples 

Below-mentioned is a simplified GST calculation: 

Particulars	Rate (%)	Amount (in ₹)
Invoice value	–	200,000
GST	12%	24,000
Price to be charged after GST	–	224,000

GST Calculations for Manufacturer 

Particulars	Rate (%)	Amount (in ₹)
Cost of the product		100,000
Profit		10,000
Total		110,000
CGST	6%	6,600
SGST	6%	6,600
Final invoice to the wholesaler		1,23,200

GST Calculations for Wholesaler 

Particulars	Rate (%)	Amount (in ₹)
Cost of the product		1,23,200
Profit	10%	1,35,520
CGST – (Credit on CGST paid above 6600)	6%	8132
SGST – (Credit on CGST paid above 6600)	6%	8132
Final invoice to the consumer		1,51,784

Products under the GST regime impose lesser tax liability on manufacturers, wholesalers, and retailers. Thus, they can have an optimum profit margin and earn a good profit on the goods sold.

Understanding GST Calculator

A GST calculator is a tool for calculating the GST to be paid on a particular product or service. Online GST calculators simplify calculating tax liability and deliver accurate results to users.

This tool is a boon for businesses, enabling them to quickly calculate their tax liability. It ensures error-free invoicing and accurate record-keeping, enhances understanding of the GST component in purchases, aids in budgeting, and simplifies GST filing. Moreover, it saves time and reduces the chances of human error, making it an indispensable tool for businesses dealing with invoicing, budgeting, and tax compliance.

Several online or offline  GST calculators are available in India. One of the most accurate and reliable ones is Munim’s GST calculator. This calculator is designed to provide precise results and is regularly updated to reflect the latest GST rates and regulations. You can use it for free by visiting this link.

How to Calculate GST Using GST Calculator

The online GST calculator is a user-friendly tool that simplifies the calculation process. You just need to input the values related to your transaction, and the calculator will handle the rest. Here’s a step-by-step guide to using an online GST calculator:

Step 1: Go to Munim’s online GST calculator.

Step 2: Choose the category where your business falls, i.e. manufacturer, wholesaler or buyer.

Step 3: Add the date, such as cost, profit margin, applicable GST, etc., and that’s it. You are ready to get the computation result.

Summing Up

This was all about using an online GST calculator and its business benefits. After reading this blog, we hope you will prefer to use Munim’s online GST calculator. If you want a more advanced and permanent solution to ease your business compliance, subscribe to Munim—Accounting & GST software for SMEs in India. This cloud-based accounting software is free for fiscal years 2024-25. What are you waiting for? Grab the offer now!

Frequently Asked Questions on GST

How much is the GST on gold?

GST on gold in India is 3% of its total value and an additional 5% on the making charges for gold jewellery.

What is the full HSN code form?

The full form of the HSN code is ‘Harmonized System of Nomenclature’. It is a system of 6-digit uniform codes that determines the classification of 5,000+ products in India and worldwide.

What is RCM on transportation?

The RCM or Reverse Charge Mechanism is the process under which the receiver of the products is liable to pay tax payment of transportation charges.

Who is eligible for Input Tax Credit under GST?

According to the GST Act, a person registered under the GST Act and paying the tax is eligible to claim the input tax credit. However, the claim will be approved only when certain predefined conditions are fulfilled.

What is the Threshold Limit for GST registration?

If a company dealing in goods has a yearly turnover of Rs. 40,000,00 minimum or a company providing services makes a yearly turnover of Rs. 20,000,00 or more, it must register under GST.