Pre 1st July 2017, a manufacturer, trader, retailer or any other business was filing returns in respect of various compliances – Excise, VAT, Service Tax, Sales Tax, and Income Tax etc. with separate returns for each of them. A continuous process of filing returns – monthly, quarterly, half-yearly and yearly existed and businesses were kept occupied throughout the year in filing one or the other return.
The basic features of the GST return mechanism include electronic filing of GST returns, uploading of invoice level information and auto-population of information relating to Input Tax Credit (ITC) from GST returns of supplier to that of recipient, invoice-level information matching and auto-reversal of Input Tax Credit in case of mismatch was also an intended feature. The return mechanism is designed to assist the taxpayer to file returns and avail ITC smoothly.
Filing of GST Returns
Online filing of GST returns is a relatively new phenomenon for Indian businesses and there are three ways to file a GST return:
- Do it all by yourself and file it at the GST portal, which might be a bit confusing and may lead to incorrect disclosure of information resulting in a direct hit on the GST compliance rating.
- Offline utilities provided by GSTN.
- Bring on board a GST Suvidha provider / Application Service Provider [ASP] and use its automated GST solution, which would complete an accurate return filing in just a few clicks.
What is GST Return?
A GST Return is a form that shall be filed by every registered taxable person. Further, GST Return can be furnished either through the portal or GST software such as Masters India GST Solution. Furnishing GST Returns helps the GST authorities carry out taxpayer’s assessment.
The common details that a GST Return carries are:
- Inward supplies
- Outward supplies
- Output GST Liability
- Input tax credit or ITC
Who Should File GST Returns?
Every normal taxable person has to file 2 monthly GST returns and 1 Annual GST Return under the GST regime. So, in total, a taxpayer has to file almost 26 GST Returns annually. The best thing about the GST system is that GSTR 2A data gets auto-populated when the supplier files GSTR 1.
Types of GST Returns
The returns are structured and mentioned in a numerological manner [from GSTR 1 – GSTR 11] to ensure capturing of the minutest of transaction details between the two parties. At the time of inception of GST, there were a total of eleven regular GST returns starting from GSTR-1 to GSTR-11 catering to various forms of taxpayers. The following shows the planned return mechanism at the time of inception of GST:
|GST Return Form||What to File?||By Whom?||By When?||Frequency|
|Form GST MIS-1||Communication of acceptance, discrepancy or duplication of input tax credit claim||Registered Taxable Supplier||NA||Monthly|
|GSTR 1||Details of outward supplies of taxable goods and/or services effected||Registered Taxable Supplier||10th of the next month||Monthly|
|GSTR 1A||Details of outward supplies as added, corrected or deleted by the recipient in Form GSTR-2 will be made available to supplier||Registered Taxable Supplier||17th of the next month||Monthly|
|GSTR 2||Details of inward supplies of taxable goods and/or services effected claiming input tax credit.||Registered Taxable Recipient||15th of the next month||Monthly|
|GSTR 2A||Auto-populated details of inward supplies made available to the recipient on the basis of Form GSTR-1 furnished by the supplier||Registered Taxable Recipient||11th of the next month||Monthly|
|GSTR 3||Monthly return on the basis of finalization of details of outward supplies and inward supplies along with the payment of amount of tax.||Registered Taxable Person||20th of the next month||Monthly|
|GSTR 3A||Notice to a registered taxable person who fails to furnish returns||Registered Taxable Person||NA||15 Days from default|
|GSTR 4||Quarterly return for compounding taxable person.||Composite Tax Payer||18th of the month succeeding quarter||Quarterly|
|GSTR 4A||Details of inward supplies made available to the recipient registered under composition scheme on the basis of Form GSTR-1 furnished by the supplier||Composite Tax Payer||NA||Quarterly|
|GSTR 5||Return for Non-Resident foreign taxable person||Non-Resident Taxable Person||20th of the next month||Monthly|
|GSTR 6||Furnish the details of input credit distributed||Input Service Distributor||13th of the next month||Monthly|
|GSTR 6A||Details of inward supplies made available to the ISD recipient on the basis of Form GSTR-1 furnished by the supplier||Input Service Distributor||13th of the next month||Monthly|
|GSTR 7||Return for authorities deducting tax at source [TDS]||Tax Deductor||10th of the next month||Monthly|
|GSTR 7A||TDS Certificate capture details of value on which TDS is deducted and deposit on TDS deducted into appropriate Govt.||Tax Deductor||TDS certificate to be made available for download||Monthly|
|GSTR 8||Details of supplies effected through e-commerce operator and the amount of tax collected||E-commerce Operator/Tax Collector||10th of the next month||Monthly|
|GSTR 9||furnish the details of ITC availed and GST paid which includes local, interstate and import/exports.||Registered Taxable Person||31st December of next financial year||Annually|
|GSTR 9A||Furnish the consolidated details of quarterly returns filed along with tax payment details.||Composite Tax Payer||31st Dec of next financial year||Annually|
|GSTR 9B||Annual statement containing the details of outward supplies of goods or services or both effected through an e-commerce operator, including the supplies of goods or services or both returned and the amount collected under||E-commerce Operator/Tax Collector||31st Dec of next financial year||Annually|
|GSTR 9C||Reconciliation Statement audited annual accounts and a reconciliation statement, duly certified.||Exceeding annual turover of 2 crore rupees||31st Dec of next financial year||Annually|
|GSTR 10||Final Return||Taxable person whose registration has been surrendered or cancelled.||Within three months of the date of cancellation or date of cancellation order, whichever is later.||Monthly|
|GSTR 11||Details of inward supplies to be furnished by a person having UIN||Person having UIN and claiming refund||28th of the month following the month for which statement is filed||Monthly|
An eagle’s eye view on the overall GSTR portfolio, would look like this:
Different returns apply to different categories. The below snapshot quickly explains this:
|Required Returns to be filed||GSTR 1||GSTR 6||GSTR 7||GSTR 4||GSTR 5|
|GSTR 2||GSTR 8|
While the above was the intended return mechanism, the actual mechanism in practice is slightly different in the following manner:
- There is no Form GST MIS-1, Form GSTR 1A, Form GSTR-2, Form GSTR-3 and Form GSTR-3A.
- Form GSTR-2A is an auto-populated dynamic form that gets updated on the basis of supplier’s filing of GSTR-1.
- Form GSTR-2B is also similar to Form GSTR-2A except for the fact that it is a static return meant to show the ITC available in relation to a particular tax period.
- Form GSTR-3B has taken the place of Form GSTR-3. There is no auto-population in this form but a PDF version is generated based on previously filed returns.
There is a vast business population, which would not be affected at all or much.
Approximately 80% of the businesses will not feel the heat with minimum number of returns.
- Depending on the State/Union Territory in which the taxpayer operates and also the type of supplies he is engaged in, the aggregate turnover threshold limit for registration is Rs. 10 lakhs, Rs. 20 lakhs and Rs. 40 lakhs.
- Taxpayers having an aggregate turnover of < Rs. 5 crore can opt for the Quarterly Returns and Monthly Payments (QRMP) scheme. If a business opts for the composition scheme, there would not be much details asked and just the total turnover.
- Taxpayers having an aggregate turnover of up to Rs. 1.5 crores or Rs. 75 lakhs (depending on the State or Union Territory) can opt for Composition Scheme which will only require the taxpayer to make quarterly payments in Form GST CMP-08 and 1 Annual return in Form GSTR-4.
- The rest of the enterprises will have to file GSTR-1 and GSTR-3B on a monthly basis and also Form GSTR-9 annually.
Prompt and accurate GST return filing will be critical, to ensure timely returns and a high GST Compliance Rating.
Any deviation from filing the returns can lead to penalties and interests. It can also cause disallowance or delay in getting the input tax credit. There’s an automated late fine for the late filers. Each day’s delay will cost Rs. 100/- [tentative], with a maximum limit up to Rs. 5000/-. In the case of annual returns, the fine is Rs. 100 per day with a maximum limit of .25% of the aggregate turnover.
Timely and accurate filing of returns will ensure delivery of credit to the last recipient.
What is GSTIN?
Every business will be assigned a unique identification number called the GSTIN number, against which all of your GST returns would be filed. The GST returns can be filed online, using the services of a GSP [GST Suvidha Provider], who will accurately consolidate all your invoices, prepare your application of GSTreturn filing and get your return registered at GSTN.
The Bottom Line
If you need any assistance or consultation in filing the GST returns, the deft team at Masters India is here to help you. AutoTax from Masters India, a GST Suvidha Provider is a fully automated GST Software, which along with other functionalities also ensures that you always file GST returns timely and accurately.