GST or Goods and Services Tax is the revolutionary indirect taxation system that replaced many taxes like sales tax, service tax, VAT, etc. It came into effect from 1st July 2017. All service providers need to collect GST and remit it to the government. However, when they use services for their work, they can get input credit on it. Organizations, where employees travel a lot, can get GST Inputs on Flight Tickets that they book for their employees.
This is possible only in official cases, where tickets are booked for the official work of a company. The organization can claim GST inputs for the GST they have paid to book flight tickets. The input they get can be adjusted to reduce the GST they need to pay. Companies that have branches all over the country or have clients in different parts spend a lot of money on air tickets. GST varies from 5 to 12% and a lot of money is spent by companies. They can now get input credit for it.
Claiming GST Input
Companies need to claim GST Input on Air Tickets by complying with the procedure and submitting returns. For this, they first need to compile all the data related to air ticket booking, GST paid, reconcile the data, and then submit the returns. It must be noted that the GST input can be claimed only after the airlines or service provider remits the GST amount to the government. If there is a delay from their side, then getting the GST input will also be delayed.
Why companies find the process difficult?
Most companies find the process of claiming GST Input on Flight Tickets to be a difficult one. The reason is there are hundreds of transactions that take place. A problem is while the airline issues the ticket, to claim GST input, the invoice is needed. Most company accountants are busy and don’t have time to follow up with the airlines to get the invoices. The invoices need to be compared with the payments done through a bank account or credit card.
All this has to be reconciled to find out the total amount spent on air tickets and the GST remitted. Once this is done, then the returns can be filed where input credit can be claimed. The entire process is cumbersome if done manually. To make the process simpler, a solution is to automate the entire process.
Automating the process
Automation ensures minimum manual intervention saving time, effort, and money. The software can scan invoices and reconcile. Good software can get invoices from different sources. The invoices are then compiled and GST details calculated. Reconciliation can be done with the GST portal to get accurate data. The software can also generate the returns statement. Humans can do all this with minimum work.
This can help in saving time and the entire process becomes simple. Claiming GST Inputs on Flight Tickets can be made easy when software automation is used for the same.