Discover how ERP helps businesses streamline GST compliance, reduce errors, automate tax calculations, and enhance overall efficiency. Learn how ERP can overcome tax-related challenges.
Rahul Sharma
Tax is an essential part of every business, no business is able to skip taxation, managing tax can be a time-consuming task, may have errors and can increase risk of a business.
An enterprise resource planning (ERP) system helps to simplify GST & tax docility by digitalising tax calculation, helps in making tax reports and ensures to follow the government regulations. This blog helps you to understand how ERP systems helps a business.
ERP is a software providing solution which will help a business to manage its functions like sales, finance, taxation etc. It includes tax compliance features which ensures legal obligation without any human intervention.
This resource reduces mankind's work, maintains accuracy, and enhance overall functioning.
There are several challenges faced by business while calculating GST, such as:
Tax structure: Due to different tax structures of different states it is difficult for a business to study the varying tax rates.
Mechanical Tax Calculation
ERP automatically calculates and other taxes based on rules and regulation defined by the government. This helps to reduce mistakes, ensures that any purchases and sales or transactions include the right tax amount.
E- Invoicing And E-Billing Incorporation:
ERP incorporates/integrates with the government to initiate e-invoices and e-bills. This reduces documentation work, and ensures that GST is based on laws.
GST Filing and Generating Reports
ERP initiates GST return filing by making following reports
This reduces complicated tasks, and risks associated with it.
Tracks ITC
ERP maintains business input tax credit by summing up purchase records with GST,
Helps to hold the right tax credit, reduce financial loss which may happen due to unclaimed ITC.
Multi-GST Management
Business takes place in different states, therefore ERP manages multi tax structures such as CGST & SGST For intra-state,IGST for inter-state, import/export duties.
Increased Understandability
ERP maintains simplified tax records and audit records, which make it easy to register with tax authorities during inspection. It can help to produce taxation outlines, transaction logs and initiate reports simply.
Finance And Accounting Integration
ERP initiated with accounts which ensures accurate financial reporting and payments of tax which helps a business to maintain decent records and avoid errors In tax filing.
Working On Updated Laws
As we know the government frequently changes their law which is a big challenge for business to maintain its tax records. ERP helps to reduce this challenge by automatically working on updated laws that reduces the risk of incorrect tax payment.
Adjustment of tax rules has per business needs
Different businesses requires different rules which need to be regulated ERP simply allows a business to customise their tax rules based on their specified requirement.
Reduces errors
When tax is calculated by a human kind, mistakes may occur but whenever ERP a software helps in tax compliance, reduces manual error.
Less time taking
The features of ERP like automatic text filling compliance and invoicing helps in time saving.
Help in avoiding penalties
With the help of regulatory compliance a business can ensure to follow tax laws which initiate in order to avoid penalties.
Improvement Customer services
With the help of integrated customer data ERP helps in offering better experience to customer and also response to customers enquiry this ultimately gives customer a better service.
Reduces production cost
By reducing manual processes and operations of ERP reduces the operational cost this helps in reductions of waste generation and Ensures stock level.
Business growth
By managing different functions of business ERP hats in the growth of business. In order of expedition of business to new location ERP system can adopt any business growth without losing any efficiency.
Security
With several features ERP also offers enhanced security features such as role based control which helps to protect business documents and sensitive information.
Conclusion
Hand operated GST can give rise to Incorrect tax values which lead to business risk . ERP can be a safe option which has different features to simplify tax operation.
If someone wants to effectively manage their GST,ERP can be one of the best option available.
Also Read: Empowering Data-Driven Decisions: The Role of Tableau in Modern ERP Systems
