It’s been more than two years now since Goods and Services Tax (GST) has been implemented. And the journey has been quite backbreaking so far.
Though, the initial roll out of GST received optimistic reviews, there were a host of challenges that India Inc. had to confront.
Besides dealing with a complex tax structure incorporating multiple tax rates, the industry had to combat with compliance related requirements.
Such a procedure was implemented to roll out a matching concept for claiming input tax credit (ITC). But due to technical glitches, the GST Council allowed the industry to file an interim summary return in Form GSTR 3B.
Such a return enabled the taxpayers to report their total tax liabilities and avail tax credits. No invoice level information was required for this form.
However, taxpayers still had to go through an unnerving experience with regards to online compliance for GST Returns. Therefore, to simplify the tax returns, the GST Council suspended the initial procedure of filing three monthly returns. Instead, it demanded filing of GSTR 1 and GSTR 3B only.
But to consolidate the periodical returns and simply return filing additionally, the GST Council approved a new return design in its 27th Meeting.
Under the new procedure to file GST returns, the taxpayers would have to file only one monthly return. This return will contain two tables.
One for reporting outward supplies. And one for availing input tax credit based on invoices uploaded by the supplier.
Moreover, the proposed structure would allow the suppliers to upload the invoices on real time basis. Such invoices can be viewed and locked by the buyer for availing input tax credit. And reconciliation of invoices with that of buyers would take place offline.
Therefore, one can say the government has taken the initiative to simplify compliance related requirements and ease of doing business.
And as a taxpayer, you need to be prepared to adapt to such a change as and when it is implemented.
Therefore, to help you file your GST Returns without any ambiguity, here is a complete guide on returns under GST. This guide will cover:
- What is GST Return?
- Who should file GST Return?
- Types of GST Returns
- Due Dates to File GST Returns
- Extension of Due Dates to File GST Returns
- Penalty for Not Filing GST Returns on Time
What is GST Return?
Every registered person paying GST is required to furnish an electronic return every calendar month.
A “Tax Return” is a document that showcases the income of a registered taxpayer. Such a document needs to be filed with the tax authorities in order to pay tax to the government.
The tax to be paid by a registered dealer depends upon the income declared by such a person in the tax return filed with the tax authorities.
Under the initial GST Return filing procedure, the tax return document demanded the taxpayer to disclose the following details:
- Outward Supplies (Sales)
- Inward Supplies (Purchases)
- GST On Output
- GST on Input (Input Tax Credit)
- Other Particulars (As May be Prescribed in the Document)
***Note: However, the current system of GST Return filing requires a taxpayer to update outward supplies information in GSTR 1. And then file a summary return in GSTR 3B. All the other forms like GSTR 2 and GSTR 3 have been suspended for the time being.
As mentioned above, from April 1, 2019, the incumbent government is planning to implement the new GST Return design. This simplified version of return would require the taxpayers having an annual turnover of over Rs 5 Crores to file one monthly return only. Small business owners,having an annual turnover of upto Rs 5 Crores would have the option to file quarterly return.
The following section describes the original GST Return filing procedure for you to have a broader view. Though this procedure was never implemented due to increased compliance, it will help you in understanding how GST Returns procedure works.
Types of Returns Under GST
Outward Supplies – GSTR-1
1. A return for outward supplies should be filed by every registered taxpayer except for the following:
- Input Service Distributor (ISD)
- Non-resident taxable person
- Persons paying tax under section 10 (Composition Levy)
- Taxpayers paying tax under section 51 (TDS)
- Persons remitting tax collected under section 52 (TCS)
- Providers of Online Information and Data Access & Retrieval Service to a non-taxable online recipient.
2. This return showcases details of 1) invoices, 2) debit notes, 3) credit notes and 4) revised invoices issued pertaining to your outward supplies. Such a return had to be filed within 10 days from the end of the tax period in Form GSTR-1.
3. Furthermore, you are not allowed to furnish such details from the eleventh day to the fifteenth day of the month succeeding the tax period. This means that the GST portal was not available for persons filing returns of outward supplies during such a period. This is so because it was the period during which persons filed returns for inward supplies.
4. And, in case you fail to furnish the details relating to outward supplies, a penalty is charged for the same. The fine amounts to a sum of Rs 100 for each day of continuing default subject to a maximum to Rs 5,000 only.
5. Also, the due date to file GSTR 1 can be extended for any class of persons beyond the tenth of the succeeding month by the Commissioner. The reasons for such an extension would be notified.
6. Under the original return filing procedure, the recipient of supply had the opportunity to accept, reject, amend or delete the details. Accordingly, details provided by the supplier were auto-populated in GSTR 2A. And it was made available to the recipient electronically for matching purposes. This opportunity, however, is not available at present as GSTR 2 has been suspended.
7. In case any error or omission occurred while matching, the rectifications were brought about accordingly. Any unpaid tax and interest was paid by the persons responsible for filing the return of outward supplies.
8. However, such rectifications are not allowed after you file:
- annual return or
- the return for the month of September of the following financial year to which the details pertain to
whichever is earlier.
Inward Supplies (GSTR 2)
After the supplier uploads the details of the outward supplies in Form GSTR 1, the recipient is required to furnish details of inward supplies.
1. Once the supplier uploads details in GSTR 1, the recipient of supply is required to match his inward supply details with that of the outward supply details of the supplier.
2. The details uploaded by the supplier will be made available to the recipient in Form GSTR 2A. This form is auto-populated and is read-only document. Such a form would enable the recipient to verify the details uploaded by the supplier in GSTR 1. Also, using the said details, the recipient could accept, reject, modify or keep the invoices pending. Moreover, all such changes were made by the recipient in GSTR 2. This process of making changes and filing of GSTR 2 had to be undertaken between 11th and 15th day of the succeeding month to which such input tax credit relates.
3. Modifications made by the recipient in GSTR 2 were then made available to the supplier in Form GSTR 1A. Such a form was either accepted or rejected by the supplier. On either accepting or rejecting the details made available in GSTR 1A, the supplier had to amend GSTR 1 to that effect.
4. Therefore, if any errors or omissions are discovered while matching the returns, modifications with regards to the same shall be effected. Accordingly, if any tax or interest liability is applicable, it shall be paid by the person filing the return of inward supplies.
5. However, the modification of errors or omissions is not allowed:
- after filing of annual return or
- before the due date for filing the return for the month of September of the following financial year
whichever is earlier.
6. Furthermore, the registered persons having an aggregate turnover of upto Rs 1.5 Crore could furnish Form GSTR 1 on quarterly basis instead of furnishing it on monthly basis.
Hence, a normal taxpayer had to file the above mentioned returns every month. Following are the returns that had to be filed in some specific circumstances.
In July 2017, the GST Council had deferred filing of form GSTR-3 in order to simplify tax returns. The Council recommended that taxpayers should file GSTR-3B for the months of July and August 2017 in place of GSTR-3.
Form GSTR-3B was introduced as a provisional measure. However, its use was extended and continues to be used till date.
GSTR 3B is a simplified summary return that every normal registered taxpayer needs to file. Such a return declares the summary of GST liabilities of the taxpayers for the tax period in question.
Moreover, it helps the taxpayer to discharge of the tax liabilities in a timely manner. But following registered persons need not file GSTR-3B:
- Input Service Distributor
- Taxpayers registered under Composition Scheme
- Suppliers of online information and database access or retrieval services (OIDAR)
- Non-Resident Taxable Person
Unlike GSTR-3, this form does not require the compliance of comparing invoices between supplier and purchaser. That means both the suppliers and the recipients file the GSTR-3B form separately.
Therefore, such a facility does not cause delays in filing of returns which would consequently attract late fees and interest.
The GSTR-3B must be submitted by the 20th of the month succeeding the tax period for which GST is filed. In case no transactions have been undertaken in a particular month, the registered person needs to file a NIL return for that period.
Under GST, every normal registered person needs to file an annual return in Form GSTR 9 once in a year. However, the following list of registered persons are not required to file GSTR-9:
- Taxpayers opting Composition scheme as they must file GSTR-9A
- Casual Taxable Person
- Input service distributors
- Non-resident taxable persons
- Persons paying TDS under section 51 of GST Act.
This form consists of details regarding (i) the inward and outward supplies (ii) Input Tax Credit and (iii) consolidated tax declared in monthly or quarterly returns filed during the financial year. Such information is declared under different tax heads.
These heads include CGST, SGST and IGST. Additionally, there are 4 types of annual returns: GSTR-9, GSTR-9A, GSTR-9B and GSTR-9C. Each of the forms has its own relevance.
The due date to file GSTR-9 date is 31st December of the subsequent financial year. However, as per the 31st GST Council Meeting, the due dates for filing GSTR-9, GSTR-9A and GSTR-9C for the FY 2017-2018 have been extended to 30th June, 2019.
|Type of Return||Description||Frequency||Due Date|
|GSTR-1||Details of Outward Supplies of Goods and Services||Monthly||11th of the Next Month|
|GSTR-2||Details of Inward Supplies of Goods and Services to claim Input Tax Credit||Monthly||15th of the Next Month|
|GSTR-3||Monthly Return After Finalizing the details of Inward Supplies as well as Outward Supplies||Monthly||20th of the Next Month|
|GSTR-3B||Simplified Summary Return that Declares the Summary of Outward Supplies along with Input Tax Credit.||Monthly||20th of the Next Month|
|CMP-08||Return To Be Filed By A Taxpayer Registered Under the Composition Scheme||Quarterly||18th of the Month Succeeding the Quarter For Which Return is to be Filed.|
|GSTR-5||Return To Be Filed By a Non-Resident Taxable Person||Monthly||20th of the Next Month|
|GSTR-6||Return To Be Filed By an Input Service Distributor||Monthly||13th of the Next Month|
|GSTR-7||Return To Be Filed By Authorities Deducting Tax At Source||Monthly||10th of the Next Month|
|GSTR-8||Return Reflecting Details of Supplies Effected Through E-Commerce Operator And The Amount of Tax Collected||Monthly||10th of the Next Month|
|GSTR-9||Annual Return To Be Filed By a Normal Taxpayer||Annually||31st December of the Next Financial Year|
|GSTR-9A||Annual Return To Be Filed By A Person Registered Under the Composition Scheme Under GST||Annually||31st December of the Next Financial Year|
|GSTR-10||Final or the Last Return To Be Filed By a Person Whose GST Registration Is Cancelled||When Registration Gets Cancelled||Within a Period of 3 Months from the Date of Cancellation or Date of Order of Cancellation, whichever is later|
|GSTR-11||Return To Be Filed By A Person Who Has Been Allotted a Unique Identification Number (UIN)||Monthly||28th of the Month Succeeding the Month For Which Statement is Filed|
Procedure To File Returns
Initial Procedure For Filing Returns
|Return for “Outward Supplies” were filed in Form GSTR–1||On or before 10th day of the month succeeding the tax period|
|Details of Form GSTR-1 provided by the supplier were auto-populated in Part A of Form GSTR-2A. The same had to be made available to the recipients of supply.||After 10th day of the month succeeding the tax period|
|The recipients of supply were to review and modify Form GSTR 2A. After reviewing the form, they had to file Form GSTR 2. In case any outward supplies did not match with the recipients’ return of inward supplies, the return for outward supplies had to be rectified. All such rectifications made by the recipients were made available to the outward supplier in Form GSTR 1A.||GSTR 2 was filed between 11th day to 15th day of the month succeeding the tax period. Due dates for filing of GSTR-2 shall be notified subsequently.|
|After receiving details in Form GSTR 1A, the suppliers had to either reject or accept the changes by each of the recipient. The acceptance or rejection of the details were conveyed by GSTN.||Before end of 17th day of the month succeeding the tax period.|
|The changes accepted or rejected by the supplier would get auto populated in Form GSTR 1. These changes would get reflected in monthly return that needs to be provided in Form GSTR 3. The supplier may either accept or reject the changes made by the recipient on or before the 17th day of the succeeding month (not before 15th of succeeding month).||Before end of 20th day of the month succeeding the tax period. Due dates for filing GSTR-3 shall be notified subsequently.|
|Return for “Outward Supplies” are filed by the suppliers in Form GSTR–1||On or before 10th day of the month succeeding the tax period|
|Details of Form GSTR-1 provided by the supplier are auto-populated in Part A of Form GSTR-2A. The same shall be made available to the recipients of supply. Then, every registered dealer files a monthly self-declaration in Form GSTR-3B. It gives a summary of total inward and outward supplies, eligible ITC Claim and net taxes payable. Based on Form GSTR 3B, the buyers claim credits on a provisional basis.||Before end of 20th day of the month succeeding the tax period. Due dates for filing GSTR-3B shall be notified subsequently.|
|The GSTN compares GSTR-2A with the GSTR-3B during reconciliation checks. It accepts the claims based on matches found during reconciliation checks. Any discrepancy leads to scrutiny notices being issued to the taxpayers by authorized officers through specified forms.|
|Taxpayers either accept or reject the notice. If they accept, the discrepancy shall be communicated to supplier and recipient. On the receipt of such a discrepancy, the supplier shall either rectify the discrepancy in his valid return for the month in which discrepancy is communicated. Else, the same shall be carried forward to his subsequent monthly return.|
|If the taxpayer rejects the notice, then government will charge interest at the rate of 18% for wrong claim of credit.|
New/Simplified GST Returns Procedure
Under the new/simplified procedure of filing GST Returns, all taxpayers excluding the following shall file one monthly return:
- Small Taxpayer
- Composition Dealer
- Input Service Distributor
- Persons liable to deduct tax at source under section 51
- Non-Resident Registered Person
- Persons liable to collect tax at source under section 52
A Small Taxpayer refers to the one who has an annual turnover of up to Rs 5 Crores in the last financial year. Such taxpayer has the facility to file quarterly return along with monthly payment of taxes on self-declaration basis. However, this facility would be optional and the small taxpayer can even file monthly return like a large taxpayer. Whereas, the taxpayer having an annual turnover of over Rs 5 Crores needs to file monthly return. The due date for filing of return by such a large taxpayer shall be 20th of the next month.
Additionally, there can be cases where taxpayers do not have any purchases, output tax liability and input tax credit to avail in any quarter of the financial year. In such situations, taxpayers shall file only one NIL return for the entire quarter. Furthermore, for the first and the second month of the said quarter, such taxpayers shall send an SMS reporting NIL transaction.