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Decoding GST for Oracle Customers
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As India gets ready to implement the new GST law, the question on top of most of the IT
leaders, finance leaders is regarding the readiness of the IT systems to meet the new
requirements.
Are the changes to the system simple or complex? How long will it take to solution and
implement the change? Has this been done before? Can you speed up the process? When RECENT POSTS
do we start with work to be ready on time? These are absolute valid concerns and need
Supply chain visibility
immediate attention. Optimization overdrive
Have you planned the testing of
Infosys has been working on building the solution to help enterprises move to new GST law custom reports in your Upgrade
Project?
smoothly and quickly. The Infosys solution Oracle Projects for Project Based
Manufacturing Industries A
Perspective
Uses the Infosys 'Tax Assessment' framework to understand the likely impact areas.
OBIEE 11G Performance Optimization
Uses the Infosys prebuilt solutions, templates to solution the requirements Strategies Part II
Uses the Infosys Intrak implementation approach to implement the solutions OBIEE 11G Performance Optimization
Strategies Part I
Dummies Guide Enterprise
Note, the solution has not considered Localization patches which Oracle may come up with. Application Deployment Options
As of now, Oracle is still working on the localization patches. Integrated profitability analytics The
need, struggles and future
Improving Performance of your Sales
Assessment Infosys Tax Assessment framework: Personnel The Cloud Way
Happy Customers with Augmented
The Infosys Tax Assessment framework, has been built based on our experience in Humanity AI
implementing tax solutions across the world for VAT, Sales tax regimes in Americas, EMEA,
and APAC. The framework ensures the tax impacts easily and in a structured way without CATEGORIES
any misses. Business Intelligence and EPM
Business Process Transformation
The Infosys Tax Assessment framework, discusses the impacts within the below five ERP Training & Adoption
boundaries. From Leadership’s Desk
Industries
1. Master Data Communication, Media and
Entertainment
2. Tax rules ( defaulting tax on business transactions) Energy, Utilities and Services
3. Cutover Impacts Financial Services
Insurance Healthcare and Life
4. Business documents Sciences
5. Reporting and Accounting Manufacturing
Public Sector
The provision of 'Credits and Refunds' have also created a lot of confusion and anxiety. The Retail, CPG and Logistics
Mobility
Infosys framework has been tailored to assess the likely systemic requirements around
Oracle IT Shared Services
credits and refunds. Oracle Openworld
2016
1. Master Data 2015
2014
Master data like supplier master, customer master, legal entity setups, General Ledger 2013
accounts and Part master needs to be enriched with the new tax registration details and 2012
2011
exemption details to meet the GST law requirements. 2010
2009
GST Requirements on Registration: 2008
Oracle Products
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4/17/2017 InfosysOracle Blog:Decoding GST for Oracle Customers
Edge Products
As per the Model bill, the existing dealers would be automatically migrated. The new GSTIN
JD Edwards
will be a 15digit GSTIN based on IT PAN. Oracle EBusiness Suite
Liability to get registered: Every supplier should be registered if aggregate turnover in a Oracle Fusion Applications
Financial year exceeds 0.9 million / 9 Lakhs INR (0.4 million / 4 Lakhs INR if the business is PeopleSoft Enterprise
registered in North Eastern States and Sikkim). Siebel/CRM
Oracle Technologies and Fusion
Middleware
Liability to pay tax: will be after crossing the threshold of 0. 5 Million / 5 Lakhs INR for NE Social CRM
states and Sikkim and 1 Million / 10 Lakhs INR for Rest of India. Small dealers having sales
below 5 million INR can also adopt the Composition scheme and pay flat of about 1 to 4% tax BLOG ROLL
on turnover.
BIInsider
Oracle OpenWorld Blog
The tax is also determined based on the type of item, hence the parts should also be Oracle Blog Center
categorized using HSN Code. The Oracle Community Network
Oracle News Aggregator
2. Tax Rules (defaulting tax on business transactions) IT Toolbox: Oracle Knowledge Base
Oracle Musings
The tax rules default the tax rates on different transactions P2P transactions and O2C
transactions. The Infosys 'Tax Assessment' framework helps building a tax matrix
capturing all the tax rules in a single matrix, considering all the tax determining factors like ARCHIVES
party, place, product and process. The tax matrix ensures all tax requirements are November 2016
correctly captured and are easily understood. Based on the tax matrix, the tax rules will September 2016
August 2016
be configured. The tax rules will cover branch transfers and job work (OSP) transactions.
February 2016
January 2016
GST Requirements impacting tax rules:
December 2015
November 2015
GST is based on supply of goods or services against the present concept of tax on October 2015
the manufacture of goods or on sale of goods or on provision of services. September 2015
GST will be Destination based tax against the present concept of origin based tax. August 2015
July 2015
Local Transactions will attract Dual GST With the Centre and the States April 2015
simultaneously levying it on a common base March 2015
February 2015
Interstate Transactions will attract Integrated GST (IGST) would be levied on inter
January 2015
State supply (including stock transfers) December 2014
Import Transactions will attract IGST would be treated as interState supplies. October 2014
September 2014
There are also likely to be multiple rate based on the type of item July 2014
June 2014
Merit Rate May 2014
April 2014
Standard Rate February 2014
DeMerit Rate January 2014
December 2013
Zero rate taxes for certain items
November 2013
October 2013
3. Cutover September 2013
August 2013
The cutover from an old solution to a new solution is likely to impact the transactions
July 2013
which are midway in the end to end process. For example a PO created under an old tax April 2013
regime might have old tax related data. When an invoice is created by matching the March 2013
February 2013
invoice to the PO, it might result in multiple taxes one with old tax rates, statuses and
January 2013
the other with new tax rates, statuses. December 2012
The Infosys solution is able to identify the potential areas of impacts and leverage pre November 2012
October 2012
built solutions to quickly identify and resolve such issues.
September 2012
August 2012
4. Business Document July 2012
June 2012
Tax related information for e.g. tax registration details are usually printed on business
April 2012
documents like shipping documents, bill of lading, AR Invoices, purchase orders. March 2012
Considering the refund / credit balance, the GST TIN of the buyer and seller should be February 2012
January 2012
printed on the AR invoices. The Infosys 'tax assessment framework' specifically poses
December 2011
questions around the business documents and invoices numbering. This is critical and is November 2011
often missed, leading to penalties and noncompliance issues. October 2011
September 2011
August 2011
5. Reporting and Accounting July 2011
The Infosys 'Tax Assessment Framework' finally looks at the reporting and the accounting June 2011
May 2011
requirements. The monthly, quarterly, yearly, adhoc reporting requirements are captured
March 2011
as part of this step. The reports used for reconciliation with the general ledger and the February 2011
number of GL accounts needed for reconciliation and reporting. Companies may want January 2011
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December 2010
separate accounts for Input IGST, Input SGST, Input CGST, Output IGST, Output SGST
November 2010
and Output CGST for easy reconciliation and credit tracking. October 2010
September 2010
GST Requirements on reporting: August 2010
June 2010
The Model GST Law proposes following reports May 2010
April 2010
Monthly Quarterly Annual Others March 2010
January 2010
GSTR 1 Outward GSTR 4 GSTR 8 GSTR 5 Periodic return by
December 2009
supplies Quarterly return for Annual NonResident Foreign November 2009
compounding Return Taxpayer (Last day of October 2009
September 2009
Taxpayer registration)
August 2009
June 2009
GSTR 2Inward ITC Ledger of May 2009
April 2009
supplies received taxpayer(Continuous)
March 2009
January 2009
GSTR 3Monthly Cash Ledger of December 2008
November 2008
return taxpayer(Continuous)
October 2008
GSTR 6 Return for Tax ledger of August 2008
Input Service taxpayer(Continuous) June 2008
Distributor (ISD)
GSTR 7 Return for
Tax Deducted at
Source
GST Requirements Credits and Refunds
This is probably the most controversial change suggested by the Model GST Law. The credit
claim process has been a topics of hot discussions as it could have big impact on the cash
flow and even margins of the enterprises.
Below are the details of the credit and refund process.
The above requirements are likely to lead to the following systemic requirements
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A systematic way to automatically calculate the credits
A systematic way to do a vendor account reconciliation
The need to do a vendor reconciliation will need an ability to upload the vendor data
from GSTN into Oracle.
A form to view the GST balance and ability to writeoff credits which cannot be
claimed
Solutioning using Infosys Accelerators
We have a prebuilt repository of readytodeploy solutions, which will help enterprises
shorten the time to solution and then to develop the solutions. The solutions cover all the
areas mentioned below
Refunds and Credits:
The Infosys solution for claiming refunds and credits will require developing the following
programs and solutions to track credits, perform vendor reconciliation, claim credits and
writeoff credits.
Tracking Credits A custom form will be developed to track the GST credits.
Vendor Reconciliation Two custom programs will be built
1. A custom program will be built using API provided by GSTN, to upload supplier
data.
2. Custom program will be built to automatically list the unreconciled items with
reason code e.g. Goods in transit.
Claim Credits A custom program will be built to automatically claim credits as per the
GST rules
Writeoff credits The custom form to track credits, will include the ability to writeoff
credits.
Timelines:
The Infosys solution will enable enterprises to freeze the GST solution in 58 weeks,
leveraging the Infosys 'Tax assessment framework' and prebuilt solution repository.The likely
timeline for the solution will be as below.
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In Conclusion:
Considering time framework of 12 months for solution finalization plus implementation effort
of 24 months, it is prudent for organizations to start the work on GST immediately, to be
ready for the 01Apr2017 launch.
Posted by Pramod Kumar Rijhwani on September 17, 2016 7:51 PM | Permalink
COMMENTS
This article helps to understand end to end implications of GST and how to go about resolving the same
Posted by: Sunil | November 16, 2016 1:21 AM
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