The launch of GST on the 1st of July 2017 not only brought to the forefront the collaborative efforts of central and state governments, central and state tax departments, banks, taxpayers, tax consultants, but the role of a public-private partnership in the form of an accessible IT platform as well, popularly known as Goods and Services Tax Network (GSTN). Essentially a non-profit, with a 49.5% stake held collectively by the central and state governments the GSTN has come into being with the primary goal of providing IT infrastructure and services to all the stakeholders mentioned above i.e. from governments to tax departments to banks to taxpayers, and thereby, fostering such environment and tools that would in turn aid in the smooth and practical implementation of Goods and Services Tax (GST).
With a common GST portal serving as the front-end of the broader GST IT ecosystem, and the IT infrastructure of the central and state tax departments functioning as back-ends for a horde of administrative functions (such as registration approval, assessment, audit, adjudication, etc.), GSTN shall, through a unified platform work towards increased and efficient tax management. Additionally, through a common and shared IT platform, GSTN is all set to allay many of taxpayer’s concerns by facilitating a range of tasks – right from filing registration application and returns, to creating challans, determining IGST payment, claiming ITC via matching B2B invoices uploaded by taxpayers to generally improving business intelligence and management.
This is where the concept of GST Suvidha Provider (GSP) and Application Service Provider (ASP) comes into the picture. While taxpayers can certainly access the front-end directly from the G2B portal provided by GSTN, they can also take the help of third-party GST Software’s associated with the GST framework for interfacing with the GST System for completing a variety of tasks that also, majorly, includes filing of returns. It must be noted though, that the features provided by the GST portal would be of a uniform nature, and quite basic in form and design, in a way that caters to all taxpayers. On the other hand, third-party applications would obviously ensure users get to access more varied, refined interfaces and superlative features designed keeping specific groups of taxpayers in mind (large businesses, SMEs and small businesses as taxpaying users). Not only are these applications comparatively more user-friendly, but offer better protection as well, by virtue of secure GST system APIs (Application Programming Interfaces) in place.
Let us read on to find out the essence of GSP and ASP, and explore the ways these tools are set to take on the mantle of implementing and managing one of the most crucial tasks in the current fiscal scenario i.e. tax compliance under the GST regime using GST-enabled platforms.
To make GST system more secure & reliable, GSTN has shared APIs with selected GSPs only. An acronym for GST Suvidha Provider, GSP is essentially an enabler between ASP (Application Services Provider) and GST system by facilitating seamless data communication via GST APIs. GSPs are also an ASP to facilitate GST compliance for users/taxpayers through its web platform (something like the GST compliance solution interface found here on Masters India). Authorized by the Government of India, the compliance features provided on such platforms can be used by taxpayers for uploading invoices, file GST returns (GSTR) and real-time reconciliation. ERP companies and tech start-ups having expertise in developing web applications or web solutions, or rather those who fall in the IT/ITES/BFSI space are typically granted the GSP license.
Since most of the GST functionalities are now made possible through these licensed third-party applications connected to the GST Server via protected GST APIs (Application Programming Interfaces), these GSPs come across as the more convenient and user-friendly tools for taxpayers to be tax compliant. These production APIs can only be consumed via MPLS lines and can be accessed over HTTPS protocol.
Who/What is an ASP?
Application Service Provider or Application Suvidha Provider (ASP) too is a third-party application that can be used by taxpayers or users to file their GST taxes with the help of ASP partners or existing software. Since GSTN has shared APIs only with GSPs so ASPs cannot directly connect to GSTN server for this they need APIs from GSPs. ASPs can develop an “end to end solution” for corporations, taxpayers, and consultants and through them the sale or purchase of the goods and services and GST filing can be managed by taxpayers, their tax consultants or CA’s.
In the case of ASPs, business and organizations simply have to upload the data of purchase and sales of Goods and Services to the ASP. After which ASP providers are to prepare the “GST Returns” (also known as GSTRs) and file these returns through the GSPs.
A link between GSTN and ASPs, GSPs definitely boast of richer features than do ASPs, in the sense that they also offer customized services/solutions integrating both GSP and ASP functionalities and support.
Since ASPs will need to convert raw data provided by taxpayers, all necessary sensitive information pertaining to the organization’s sales and purchases such as – the subject and place of sale, the party to whom such sale is made, the sale price, the place of purchase and the purchase price, the items purchased and the cost at which the same have been purchased, etc. – need to be outlined in the raw data provided by companies and organizations seeking to avail the benefits of ASP.
Since calculation of tax inherently includes delineating profits and losses based on largely sensitive data, it is important that an ASP appointed fulfill all the criteria required of it, in the multifarious roles it inadvertently plays when engaging with the taxpayer. Some of these roles have been outlined below:
- Protection and Privacy of Data: As already discussed above, with volumes of sensitive information to be dealt with, it is necessary that an ASP secure data privacy with the strictest of NDAs (non-disclosure agreements) and other security measures in place.
- Verification of Data: Details submitted by the taxpayer are to be utilized by ASPs in filing GSTRs, which includes a process of authentication/verification. In order that ASPs can perform this task well, it is important that taxpayers (companies and its officials) furnish the right details so as to facilitate proper and accurate filing of returns and not incur further liability.
- Data Archiving and Retrieval–With storage period of more than eight years, ASPs act as data archives for taxpayers’ tax-related information, which means taxpayers can retrieve data at any given point of time.
- Audit Features – Not only will the ASP platform serve as a storehouse of information from the point details are uploaded till the time of filing the returns, but also cross-check the audit features available on the interface. This simultaneous maintenance of relevant information makes for a smoother audit process.
- Maintains consistency and accuracy in the application and filing process – In a tax-ridden country like India where rules and procedures override simplicity in tax calculations, appointing an ASP for the task ensures consistency and accuracy in filing tax returns, and avoiding possible tax liabilities.
In addition to the afore mentioned roles, GSP & ASP can provide other value-added service such as tax alerts, legal support.
As an empanelled GST Suvidha Provider (GSP) and Application Service Provider (ASP), Masters India may just be the one stop for all your taxation-related queries and processes. With a fully automated GST software for filing returns, and amplified features that help keep your tax record spotless, Masters India will work to ensure you secure a high GST compliance rating without breaking into a sweat over the technicalities of it.
To avail professional guidance and services in this regard, please connect with Masters India at firstname.lastname@example.org | 1800 212 6141.