The aim of the New GST Return Filing System is to bring transparency and increase precision in the return filing system. The GST Council in its 31st meeting decided to roll out the New GST Return System.
As per this system, the small taxpayers with an annual aggregate turnover of upto Rs 5 crores in the previous financial year can choose to file both monthly or quarterly returns.
Thus, under the new system, monthly return consists of three parts. These include:
- GST RET-1, that is the Main Return
- GST ANX-1 – Annexure of outward supplies and inward supplies attracting reverse charge
- GST ANX-2 – Annexure of inward supplies
However, large taxpayers having average aggregate annual turnover of more than Rs 5 Crores in the previous financial year are required to file monthly returns in Form GST RET-1.
Thus, small taxpayers choosing to file Quarterly Returns would be required to file the same as follows:
- GST RET-2 (Sahaj Return for B2C) or GST RET-3 (Sugam Return for B2B and B2C) which is the main return
- GST ANX -1- Annexure of outward supplies and inward supplies attracting reverse charge
- GST ANX-2 – Annexure of inward supplies
- GST PMT-08 – Monthly tax payment
To make the transition from the current return filing to the new GST Return Filing System easy, GST Council worked out a transition plan.
As per this plan, it made available a prototype of the offline tool in May 2019 to allow taxpayers to get familiar with the new GST Return Filing System.
As per the 37th GST Council Meeting, the Council, however, has postponed the implementation of the new GST Return Filing System until April 2020.
This article talks about GST Ret-3 (GST Sugam Return), its components and its format.
What is GST Sugam Return?
Small taxpayers with an annual turnover of upto Rs 5 Crores can only choose to file quarterly returns in Form GST RET-3, that is, GST Sugam Return. GST RET-3 – Sugam allows the small taxpayer to declare details of:
- Outward supplies to consumers and unregistered persons (B2C),
- The outward supplies to registered persons (other than those attracting reverse charge) and
- inward supplies attracting reverse charge only.
It is a simplified quarterly return which the small taxpayers could file from April 2020 as discussed in the 37th GST Council Meeting.
While small taxpayers making B2C and B2B supplies and having a turnover of upto Rs 5 Crore in the previous financial year could choose to file quarterly return in GST Sahaj, they are required to make monthly tax payment via GST PMT-08.
Components of GST Sugam
|2. Basic Details|
a. Legal Name of the registered Person
|3. Summary of outward supplies, inward supplies attracting reverse charge, debit / credit notes etc. and tax liability|
|A. Details of outward supplies|
|1.||Taxable supplies made to consumers and unregistered persons (B2C). This gets auto-populated from table 3A of FORM GST ANX-1.|
|2.||Taxable supplies made to registered persons (other than those attracting reverse charge)(B2B). This gets auto-populated from table 3B of FORM GST ANX-1.|
|3.||Liabilities relating to the period prior to the introduction of current return filing system and any other liability to be paid|
|4.||Sub-total (A) [sum of 1 to 3]|
|B. Details of inward supplies attracting reverse charge|
|1.||Inward supplies attracting reverse charge will be auto-populated from table 3H of|
FORM GST ANX-1. The values will be net of debit / credit notes and advances on
which tax has already been paid at the time of payment, if any
|2.||Sub-total (B) [sum of 1]|
|C. Details of debit / credit notes issued, advances received / adjusted and other reduction in liabilities|
|1.||Debit notes issued other than those attracting reverse charge. This gets auto-populated from Form GST ANX-1.|
|2.||Credit notes issued other than those attracting reverse charge. This gets auto-populated from Form GST ANX-1.|
|3.||Advances received on account of supply of services during the period will be|
reported by the taxpayer after giving effect to refund vouchers. The same may be
used to adjust any advances reported wrongly earlier
|5.||Reduction in output tax liability on account of transition from composition levy to|
normal levy or any other reduction in liability shall be reported here by the
|6.||Sub-total (C) [1-2+3-4-5]|
|D. Total value and tax liability (A+B+C)|
|4. Summary of inward supplies for claiming input tax credit (ITC)|
|A. Details of ITC based on auto-population from FORM GST ANX-1, action taken in FORM GST ANX-2 and other claims|
|1.||Credit on all documents which have been rejected in FORM GST ANX-2. These balances are net of debit /credit notes.|
|2.||Credit on all documents which have been kept pending in FORM GST ANX-2. These balances are net of debit /credit notes.|
|3.||Credit on all documents which have been accepted (including deemed accepted) in|
FORM GST ANX-2. These balances are net of debit/credit notes.
|4.||Eligible credit (after 1st July, 2017) not availed prior to introduction of this return but admissible as per Law (transition to new return system). This is a user input item and hence you are required to fill this section manually.|
|5.||Inward supplies attracting reverse charge. These balances are net of debit / credit notes and advances paid, if any. This is auto-populated from table 3H of FORM ANX-1.|
|6.||Upward adjustment in input tax credit due to receipt of credit notes and all other adjustments and reclaims. This is a user input items and hence you are required to fill this section manually.|
|7.||Sub-total (A) [sum of 3 to 6]|
|B. Details of reversals of credit|
|1.||Credit on documents which have been accepted in previous returns but rejected in the current tax period. These balances are auto-populated and are net of debit / credit notes.|
|2.||Supplies not eligible for credit [out of net credit available in table 4A above]. This is a user input items and hence you are required to fill this section manually.|
|3.||Reversal of input tax credit as per the law (Rule 37, 39, 42 & 43). This is a user input items and hence you are required to fill this section manually.|
|4.||Other reversals including downward adjustment of ITC on account of transition from composition levy to normal levy, if any. This is a user input items and hence you are required to fill this section manually.|
|5.||Sub-total (B) [sum of 1 to 4]|
|C. ITC available (net of reversals) (A- B)|
|D. ITC declared during first two months of the quarter|
|Sub-total (D) [sum of 1& 2]|
|E. Net ITC available (C-D)|
|5. Amount of TDS and TCS credit received in electronic cash ledger|
|6. Interest and late fee liability details|
|1.||Interest and late fee due to late filing of return (including late reporting of invoices of previous tax periods, rejection of accepted documents by recipient) (to be computed by the system)|
|2.||Interest on account of reversal of input tax credit (to be calculated by the taxpayer)|
|3.||Interest on account of late reporting of reverse charge supplies (to be calculated by the taxpayer)|
|4.||Others interest liability (to be specified)(to be calculated by the taxpayer)|
|7. Payment of tax|
|8. Refund claimed from electronic cash ledger|
Instructions to File GST Sugam
1. Auto-Filing in GST RET-3
Once the taxpayer uploads the details of supplies in Form GST ANX-1 and the recipient takes the requisite action in Form GST ANX-2, main return in Form GST RET-3 is then filed by the taxpayer.
Further, all the details reported in Form GST ANX-1 and Form GST ANX-2 get auto-populated in the main return GST RET-3.
2. Reporting Excess Tax Collected
There can be circumstances when a supplier collects excess tax from the recipients. Such excess tax can be reported in Table 3A(3) in Form GST RET-3 by the supplier.
In this part of the Table, taxpayer can report excess tax under other liabilities. And this has to be reported manually.
3. ITC Details Based On Auto-Population From Form ANX-1, Action Taken in Form GST ANX-2 and Other Claims
Table 4A of Form GST RET-3 gets auto-populated with ITC details. These details with regards to ITC include:
- ITC on the documents rejected, kept pending or accepted in Form GST ANX-2
- ITC on inward supplies attracting reverse charge as reported in Table 3H of Form GST ANX-1 etc.
- NIL or Partial ITC Claimed By the Supplier On A Credit Note Issued By Him Against An Invoice
- Any other reclaim on ITC
- Credit on documents that have been accepted in the previous returns but rejected in the current tax period.
4. Treatment of TDS/TCS
TDS deducted or TCS as collected via Form GSTR-7 and GSTR-8 respectively would be credited in the electronic cash ledger. It must be noted that small taxpayers filing GST Sugam Return are not allowed to make a supply via e-commerce operators who are obligated to collect TCS on the supply made to them by other suppliers.
Hence, this section must be used only for shifting from the old GST return system to the new system.
5. Interest and Late Fee Calculation
The interest and late fee on account of delays in return filing, late payment of taxes and uploading prior tax period invoices shall be calculated by the system.
However, other interest on account of reversals etc. shall be manually entered by the taxpayer on self-assessment basis.
6. Utilization of ITC For Tax Payment
Taxpayer can pay the tax amount by utilizing ITC under the same head or cross utilizing ITC from other heads as per the provisions of the Act. Furthermore, the balance amount of tax can be paid in cash.
7. Suggested ITC Utilization Made Available
The Form includes a payment table for tax which gives suggestion with regards to utilization of ITC. But the taxpayer can make changes in this suggested ITC utilization provided these changes are as per the provisions of the Act.
8. Payment of Tax In Case Of Supplies Attracting Reverse Charge, Interest, Late Fee and Penalty
It must be noted that tax to be paid as a result of supplies attracting reverse charge, interest, late fees, penalty shall be paid only in cash.
9. Adjusting The Prior Period’s Negative Liability
A negative liability in respect of the previous tax period is allowed to be adjusted along with the current period’s tax liability.
10. Balance In Electronic Cash and Credit Ledger Available for View
The taxpayer can view the balance amount available in electronic cash and credit ledger before making the tax payment.
11. Inward Supplies Attracting Reverse Charge And Services Imported Not To Be Added To The Turnover
Inward supplies attracting reverse charge and services imported as stated in Table 3B would not add to the turnover. The tax liability would simply include the tax amount of such inward supplies imported services.
12. Challan Facility Available On Insufficient Balance In Electronic Cash Ledger
The facility to create Challan for making tax payment is available if the electronic cash ledger of the taxpayer shows the amount of money not sufficient to pay off the tax liability.
13. Adjustment in Liabilities or ITC of Period Before New GST Return System
Adjustments in respect of liabilities or ITC with regards to the period before the introduction of the New GST Return filing system needs to be reported in Table 3 and Table 4 respectively.