Goods and Service Tax, or commonly referred as GST is a consolidated indirect tax under which different GST returns must be filed by eligible taxpayers for each financial year. The requirements for GST return filing online are different for different kinds of tax returns, and it is important to understand them in depth so as to prevent any mistakes or missed return filing. Here’s a complete guide to the concept and types of GST return filing in India.
What is GST Return Filing?
GST returns are different predefined forms which must be duly filled and submitted with the GST authority every year. These GST returns enable the authority in assessing the tax liability of a GSTIN holder as they disclose the information pertaining to sales and purchases made by the assessee, and tax collected and paid at the time.
GST return filing is the process of submitting the requisite information with the GST authority in the prescribed format within the set deadlines. The taxpayer that comes under the ambit of GST is required to file the applicable returns mandatorily each month, quarter or year.
It is important to note here that even the taxpayers who have no transactions during the period of return filing are required to file a Nil GST return.
Why Filing of GST returns is important?
The filing of GST Returns has various importance as has been given below:
For Return Filer
- Obligatory to adhere the legal compliances
- Assist in calculating the correct tax liability
- A tool to claim ITC
- Source to collect Financial Statistics of Organizations
- Inspect the relevant cases efficiently and effectively
- An origin for future policy making
- Assists in making the future compliance procedures.
- Evasions can be tracked better.
- Efficient mode of obtaining information from the taxpayers.
Who Is Liable To File GST Returns In India?
The following taxpayers have a compulsory requirement to get GST registration done and file their GST returns online:
- Individuals who hold GST registrations, or held registrations for VAT, excise or service tax previously.
- A business which has an annual turnover of more than INR 40 lakhs.
- A business which has an annual turnover of more than INR 10 lakhs and operates in North-Eastern States, Himachal Pradesh, Uttarakhand or Jammu and Kashmir.
- Any casual taxable person.
- Any Non-Resident taxable person.
- Agents of a supplier.
- Any person is running a business interstate.
- Input service distributor.
- Any person who is liable under the reverse charge mechanism.
- Any person who is running a business through an e-commerce aggregator.
- An e-commerce aggregator.
Different Types of Returns under GST Regime
The various kinds of GST return filing to be done by the eligible taxpayer in India are as follows:
GSTR 1 includes the information of the supplier’s outward supplies or services provided. The GSTR 1 must be filed by the 10th day of a month and include information such as:
- Previous year’s aggregate turnover
- Taxable outward supplies
GSTR-1A is an auto-generated GST return which is automatically generated once the GSTR 2 is filed. It includes the details of the changes made by the taxpayer and goes to the supplier who can accept or reject the amendments
GSTR-2 includes the information of the inward purchases of taxable products and services during the month. It also includes the purchased on which a reverse charge is applicable. The last date of filing this return is 15th day of the next month, and the return includes information such as:
- Inward supplies except for the supplies on which a reverse charge is applicable.
- Inward supplies where tax is applicable on reverse charge.
- TDS and TCS credit received
GSTR 2A is an auto-generated GST return which provides the details filed by the supplier to the taxpayer. No additional action needs to be taken to file this return.
GSTR-3 includes the details of every sale and purchase made during the month. This return also includes the GST liability of the taxpayer and is automatically populated by getting the required information from GSTR-1 and GSTR-2. It is a monthly GST return, and the due date for filing GSTR 3 is 20th of the next month.
GSTR-3B was a temporary return that included the details of outward supplies, inward supplies, GST liability and an input tax credit of the business. The return was to be filed till the GSTR 1, GSTR 2 and GSTR-3 were regularised.
GSTR 4A is applicable to composition dealers only and includes information relating to the purchases made. It is automatically generated once the supplier furnishes the details against the GSTIN of the composition dealer.
GSTR-4 is also applicable to composition dealers only. It is quarterly return and is similar to the GSTR-3. The last date to file this return is 18th of the month after the end of the quarter.
GSTR 5 is applicable to Foreign Non-Resident taxable persons who hold GST registration. It contains the details of sales and purchases made by a non-resident, i.e. a foreign supplier who has come for a short while to make supplies in India and does not have a business establishment in the country. The GSTR-5 return must be filed by 20th day of the next month.
GSTR 6 is applicable to Input Services Distributors and includes the details of documents issued for distribution of input tax credit. The last date to file the GSTR 6 is 13th day of the next month.
GSTR 6A is an automatically generated form and is applicable to Input Service Providers. It is generated on 11th of the next month once the supplier files their GSTR 1.
GSTR-7 relates to Tax Deducted at Source, i.e. TDS and includes the details of tax deductions made in a month. It is applicable to taxpayers who deduct TDS and must be filed by 10th day of the next month.
GST6 7A is the TDS certificate populated after the GSTR 7 is filed by the Tax Deductor.
GSTR 8 is applicable to e-commerce operators who collect TCS, i.e. Tax Collected at Source and must be filed by the 10th of the next month.
GST Annual Return- GSTR 9
GSTR-9 is the GST Annual Return which must be filed by 31st December every year by all taxpayers, even if the return is Nil. The Annual GST Return includes all the details of every sale, purchase, export, import, and tax paid and collected by the taxpayer in a year. It is a consolidation of all the monthly, and quarterly GST returns filed in that year.
GSTR 9A is also an annual GST return to be filed by taxpayers who have opted for the Composition Scheme. The due date to file this return is 31st December of the coming financial year and provides consolidated information of all the returns filed for each quarter.
GSTR-10 is to be filed only by a taxpayer when the GST registration is surrendered or cancelled. It is filed within three months from the date of cancellation or surrendering.
GSTR 11 is to be filed only by the individuals who have a Unique Identity Number (UIN) to get a refund on their purchases in India. Foreign embassies or diplomatic bodies, who hold a UIN can file GSTR 11.
What are the steps involved in filing of the GST returns?
The basic steps that are involved in filing of GST returns include:
- Uploading Invoice or Sale details
- Auto Population of Purchase details
- Auto reversal and auto population of ITC
- E-filing of returns
Process of Filing GST Returns Online
The different GST returns can only be filed online through the GST portal of the government. The details of GST returns online must be submitted before the due date specified for the return in the prescribed format.
It is important to note here that the GST return filing must be done accurately, as once the values are submitted, they cannot be changed. This makes it necessary to take help of a GST expert to file your GST returns online.
Penalty for Late GST Return Filing
Recently, the Central Board of Indirect Taxes and Custom (CBIC) issued the Standard Operating Procedure (SOP) under which, non-filing of GST returns can even lead to attachment of bank accounts and even cancellation of GST registration of the defaulter.
Filing GST returns online on time is highly critical to avoid the late fees levied on taxpayers for any form of delay. As per the GST Act, a taxpayer will be liable to pay a fine of INR 100 per day for late filing of Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST) each. This makes it a total penalty of INR 200 for each day the delay continues. However, the maximum limit for the late filing penalty has been set to INR 5000.
Along with this, the taxpayer will also be liable to pay interest at 18% per annum in case of a delay in filing the GST returns online. The interest is calculated from the day following the due date of filing the return till the date on which the taxpayer makes the payment.
Managing the different kinds of GST Return Filing can be a complicated affair and understanding the purpose of each return is important to understand the return filing liability of a taxpayer is pertinent. Seeking guidance from experienced GST professionals can help the taxpayer in managing his/her GST filing easily.