Returns under GST Regime

Submit New Article

Returns under GST Regime

				By: CA Madhav Kalani
				November 10, 2015
All Articles by: CA Madhav Kalani View Profile

Contents

Proposed GST Returns – Salient Features

The Joint Committee constituted in consultation with Government of India, for looking into Business Processes for Goods and Service Tax (GST) has submitted its Report on GST Return. The salient features proposed in relation to GST Return are as follows:

1. There will be common E-Return for CGST, SGST, IGST and Additional Tax.

2. Every registered person is required to file a return for the prescribed tax period. Return needs to be filed even if there is no business activity (i.e. Nil Return) during the said tax period of return.

The exception to this will be UN agencies etc. which shall be required to file return only for the month during which they make purchases rather than regular returns.

Also government entities/PSU’s etc. not dealing in GST supplies or persons exclusively dealing in exempted / Nil rated / non –GST goods or services would neither be required to obtain registration nor required to file returns under the GST law.

3. Periodicity of Filing returns:

Different periodicity for filing of return for different categories of taxpayers, after payment of tax due. The return can be filed without payment of self-assessed tax as per the return but such return would be treated as an invalid return.
Returns for different categories of taxpayers and its periodicity is as follows:

Return	Particulars	Due Date
GSTR 1	Monthly return for Outward supplies made by taxpayer (other than compounding taxpayer and ISD)	10^th of the next month
GSTR 2	Monthly return for Inward supplies received by a taxpayer (other than a compounding taxpayer and ISD)	15^th of the next month
GSTR 3	Monthly return (other than compounding taxpayer and ISD) (consolidated return based on the above two returns)	20^th of the next month
GSTR 4	Quarterly return for compounding Taxpayer	18^th of the month next to quarter
GSTR 5	Periodic return by Non-Resident Foreign Taxpayer	Within 7 days after the date of expiry of registration
GSTR 6	Return for Input Service Distributor (ISD)	15^th of the next month
GSTR 7	Return for Tax Deducted at Source	10^th of the next month
GSTR 8	Annual Return	By 31^st December of next FY
	ITC Ledger / Cash Ledger / Tax Ledger (These are running electronic ledgers maintained on the dashboard of taxpayer by GSTN)	Continuous

Normal / Regular taxpayers with multiple registrations (for business verticals) within a State would have to file GSTR-1, GSTR-2 and GSTR-3 for each of the registrations separately.

4. Monthly Returns –

4.1 Major Components of GSTR 1 -

Final invoice-level supply information pertaining to the tax period separately for goods and services:
For all B2B supplies (whether inter-state or intra-state), invoice level specified details will be uploaded.
For all inter-state B2C supplies (including to non-registered Government entities, Consumer / person dealing in exempted / NIL rated / non GST goods or services), the suppliers will upload invoice level details in respect of every invoice whose value is more than ₹ 2,50,000/-.
For invoices below ₹ 2,50,000/-, State-wise summary of supply statement will be filed covering those invoices where there is address on record. (The address of the buyer has to be mandatorily reflected in every invoice having a value of ₹ 50,000/- or more. Invoices for a value less than ₹ 50,000/- that do not have address on record will be treated as intra-state supply.)
For all Intra-State B2C supplies (including to non-registered Government entities, consumer / person dealing in exempted / NIL rated / non GST goods or services), consolidated sales (supply) details will be uploaded.
There will be a separate table for submitting the details of revisions in relation to the outward supply invoices pertaining to previous tax periods.
There will be a separate table for effecting modifications/correcting errors in the returns submitted earlier.

4.2 Major Components of GSTR 2 –

Final invoice-level inward supply information pertaining to the tax period for goods and services separately
The information submitted in GSTR-1 by the Counterparty Supplier of the taxpayer will be auto populated in the concerned tables of GSTR-2. It may be modified i.e. added or deleted by the Taxpayer while filing the GSTR-2. The recipient would be permitted to add invoices (not uploaded by the counterparty supplier) if he is in possession of invoices and have received the goods or services.
Auto Population in GSTR-2 from GSTR-1 will be done on or after 11th of the succeeding month. Addition or Deletion of the invoice by the taxpayer will be permitted between 12th and 15th of the succeeding month.

4.3 Major Components of GSTR 3 –

Turnover Details including Gross Turnover, Export Turnover, Exempted Domestic Turnover, Nil Rated Domestic Turnover, Non GST Turnover and Net Taxable Turnover.
Final aggregate level outward and inward supply information. These details will be auto populated from GSTR-1 and GSTR-2.
Excess payment, if any, will be carried forward to the next return period. The taxpayer will also have the option of claiming refund of excess payment through the return for which appropriate field will be provided in the return form.

4.4 Major Components of GSTR 6 –

Final invoice-level inward supply information pertaining to the tax period separately for goods and services on which the ITC is being claimed. It will be auto populated on the basis of GSTR-1 filed by the Counterparty Supplier of the taxpayer. The same may be modified i.e. added or deleted by the Taxpayer while filing the ISD return.

4.5 Major Components of GSTR 7 –

Details of GSTIN of the Supplier along with the invoices against which the Tax has been deducted.

5. Annual Return - Major Components of GSTR 8 –

It will be filed by all normal/regular taxpayers. It would provide a reconciliation of the returns with the audited financial statements of the taxpayer.
This return is to be submitted along with the audited copies of the Annual Accounts of the dealer and would be filed by 31^st December following the end of the financial year for which it is filed. A separate reconciliation statement, duly certified by a Chartered Accountant, will have to be filed by those taxpayers who are required to get their accounts audited under section 44AB of Income Tax Act 1961. Currently this limit is ₹ 1 Crore.

6. Invoice Level information to be captured in the return has been specified. For example in case of invoices pertaining to B2B transactions (for both supply and purchase) GSTIN, Invoice number, date, value, HSN Code, Taxable value, tax rate, tax amounts, place of supply (state), etc. needs to be filled.

7. Revision of Returns -

There would be no revision of returns. All unreported invoices of previous tax period would be reflected in the return for the month in which they are proposed to be included. The interest, if applicable will be auto populated.

8. Non-Filers and Late Filers -

In case of failure by the taxpayer to submit periodic returns, a defaulter list will be generated by the IT system by comparing the return filers with the registrant database. Such defaulter list will be provided to the respective GST Authorities for necessary enforcement and follow up action.

9. Acknowledgment of Return –

On submission of return, an Acknowledgement Number will be generated. However, if it is filed offline first a transaction ID will be generated and then sometime later acknowledgment of receipt of return will be generated.

10. Processing of Return –

Once a return is acknowledged, forward that GST Return to tax authorities of Central and appropriate State Govt. through the established IT interface.
The ITC claim will be confirmed to purchasing taxpayer in case of matched invoices after 20th of the month succeeding the month of the tax period month provided counterparty supplying taxpayer has submitted the valid return (and paid self-assessed tax as per return).
Auto - populate the ITC reversals due to mismatching of invoices in the taxpayer’s account in the return for the 2nd month after filing of return for a particular month.
Communicate to the taxpayers through SMS/e-Mail, about the macro-results of the matching. The details will be in the taxpayers’ dashboard/ledger which can be viewed after log-in at the Portal.

11. To sum up, the mechanism of return filing is integrated real time from the point of view of supplier and receiver. The whole process is technology driven which presupposes setting up of flawless IT infrastructure which seems a big challenge.

By: CA Madhav Kalani - November 10, 2015