GST Advisory & Structuring

What is GST advisory?

GST advisory answers the questions that routine return filing doesn't: what rate applies to a product or service, where a supply is taxed, how to value supplies between related parties, how to structure contracts and operations across states, and how a new business model will be treated.

Getting these right at the start avoids years of under- or over-paid tax. Where the answer is genuinely uncertain, an advance ruling can give a binding answer for your business.

The key terms

Common advisory areas:

Classification

Deciding the correct HSN or SAC code, and therefore the rate. Small differences in description can change the rate significantly.

Place of supply

Deciding whether a supply is intra-state (CGST and SGST) or inter-state (IGST), and whether it's an export.

Composite and mixed supplies

How bundles of goods and services are taxed — at the rate of the principal supply, or the highest rate.

Related-party supplies

Supplies between related persons, or between your own branches in different states, are taxable and must be valued under specific rules.

Input Service Distributor

A mechanism for distributing credit on common services across GSTINs of the same business, required from April 2025 for such services.

Reverse charge

Certain supplies, like some imported services and legal services, where the recipient pays the tax.

Advance ruling

A binding ruling from the state's Authority for Advance Ruling on a specific question, for the applicant.

Why it matters

GST positions compound over time:

Rates matter

Applying the wrong rate for years builds up a large liability, or overcharges customers.

Demands go back years

The department can raise demands for several past years, with interest and penalty.

Branches are separate persons

Internal supplies across states are taxable, which many businesses miss.

Credit can be stranded

Without proper distribution, credit sits in one GSTIN while tax is paid in cash in another.

Contracts shape tax

How a contract is structured can change the classification and rate.

Pricing

Knowing the rate before quoting protects margins.

Certainty

An advance ruling can settle a question before a dispute arises.

Who is this for?

Advisory is most valuable before a transaction or launch. After a notice, the question becomes defending the position.

Ways to get certainty

Different levels of certainty:

What we'll need from you

Business description

What you supply, how, to whom, and from where.

Contracts

Customer, supplier, and intercompany agreements.

Invoices

Sample invoices, showing current treatment.

Product details

Technical specifications or service descriptions, for classification.

Structure

Your GSTINs, branches, and group entities.

Specific question

The exact issue you want resolved.

Advice is quoted per question or engagement, depending on complexity.

How we advise

A typical advisory engagement:

1. 1

   Understand the facts

   We understand the transaction or business model in detail.

2. 2

   Identify the issues

   The GST questions are framed precisely.

3. 3

   Analyse

   The law, notifications, circulars, and relevant rulings are analysed.

4. 4

   Advise

   We give a written opinion with the recommended treatment and the risks.

5. 5

   Implement

   Invoicing, contracts, and systems are updated to match.

6. 6

   Seek a ruling if needed

   For uncertain, high-value issues, we can apply for an advance ruling.

Putting advice into practice

Advice only helps if it's implemented:

Update masters

Update HSN codes and rates in your billing system.

Revise contracts

Align contract terms with the tax treatment.

Set up cross-charges

Invoice internal supplies between GSTINs correctly.

Register an ISD if needed

Distribute common credit through an Input Service Distributor.

Correct past periods

Where past treatment was wrong, consider correcting it voluntarily.

Revisit when rules change

Rates and rules change with GST Council decisions.

Benefits and responsibilities