Online GST Return Filing - An Overview
As per the GST law, every individual/Company/LLP registered under the GST Act has to furnish the details of sales, purchases and the tax paid by filing for GST returns with the administrative authorities.
As a business person/ firm, one of your first priorities will be to do is GST return filing. Hence, knowing the ropes can help you make the process smoother and simpler. While filing a GST return, you are supposed to provide all the particulars related to your business activities, like the tax liability declarations, tax payments and also any other related information as per instructions provided by the government.
The GST return filing process has to be done electronically in the GST portal. A facility has to be offered for the manual process of GST return filing tasks. This facility helps the business taxpayer in India to prepare the return offline and then upload it on GSTN through the facilitation center. There are also various components of GST returns filing that you need to know about.
The GST return mainly includes purchases, output GST on the sales, input tax credits as per GST paid while making the purchases, and also includes the total sales. In order to file the GST return, the purchase invoices and GST compliant sales are needed.
What is GST Return filing?
Goods and Service Tax law now governs the major portion of the indirect tax system in India. The suppliers registered under this regime need to fulfill the compliance requirement regularly. Based on the turnover and the activities, the requirements and period of filing returns are prescribed under law.
The essence of such a tax is to integrate a host of indirect taxes into a comprehensive single tax both at the Central and State level. Accordingly, GST has subsumed an array of indirect tax levies that resulted in a cascading effect in the previous indirect tax regime. Moreover, the implementation of such a tax was introduced as a set-off relief mechanism for the seamless flow of input credit across the chain.
With online GST return filing, the taxpayers intimate the Goods and Service Tax Network (GSTN) about the inflow and outflow of supplies including the amount of tax paid and collected. While recording the taxable transactions with the Government, the taxpayer is also required to pay the amount of tax collected from an outward supplier of goods or services after the deduction of Input Tax Credit (ITC).
Who is eligible for GST returns?
Business owners and dealers who are registered under GST must file two monthly GST returns and one annual GST returns. The nature of the business also dictates the GST that is to be filed. GST returns are of various types and late filing of GST returns will result in a penalty of Rs.100 per day till the day the GST returns are filed. Once filing is done, any tax liability must be promptly paid to the government.
GST Input Tax Credit Reconciliation
GST or Goods and Services Tax is an indirect tax that depends on the value added at each stage of the supply chain of a particular service or goods until it reaches the customer or consumer. With GST, tax is imposed at various stages and to nullify the cascading effect, it is designed in a way that is meant to refund all parties that are involved in the various stages with the exception of the final consumer. This element that is employed to offset the tax liability is called an input tax credit.
Benefits of GST Return filing
- Benefits of GST Return filing
- Simple and common form for all taxes
- Score higher compliance rating
- Avoid penalty and interest
The tax already paid by the supplier is deducted from the liability to pay taxes. If the tax paid and collected transaction is recorded through filing return by both the parties, the Input Tax Credit can be passed on to the buyer and not otherwise. The registered person cannot claim the input credit if the return is not filed on time.
Under the GST regime, three different types of taxes are collected – IGST, CGST & SGST. The information about all three taxes paid or collected is required to be recorded in a single form itself. The online filing system is simplified under this regime which and is further proposed to be more simplified through one form of filing for recording all transactions
To monitor the compliance structure, the GST Network has introduced the mechanism of compliance rating. This is where all the registered persons are provided ratings based on their regularity of fulfilling the compliance and payment of taxes. The compliance ratings are publicly available on the website. The regular taxpayer is ranked with higher compliance ratings.
For delay in filing return, the taxpayer is charged with a late fee of ₹ 50 for each day of a delay till the actual date of filing. To avoid such heavy penalties, the return must be filed without any delay. The taxpayers with no tax liability also have to file the returns to avoid the late fee of ₹ 20 for each day of delay. Interest at the rate of 18% p.a. is payable on the outstanding tax liability.
Online GST Return Filing Procedures - A detailed filing process
In total, there are 3 steps to be followed in the GST return filing work for every Indian Business Taxpayer.
STEP 1: DOCUMENTS AND MONTHLY RETURNS INVOLVED IN THE GST RETURN FILING PROCESS
STEP 2: PREPARATION FOR GST RETURN FILING PROCEDURE
STEP 3: STEPS REQUIRED TO COMPLETE THE RETURNS FILING PROCESS
Can I apply for GST Registration online?
Yes. Taxpayers can apply online for GST registration. You just need to get your business registered in the official GST Portal and upload the scanned copies of all the documents needed.
Is the GST threshold limit the same for all Indian states?
No. In the North East states of India, the GST threshold limit comes to Rs.20 lakh for all types of businesses. Whereas, in states like Assam, Meghalaya, Nagaland, Mizoram, Tripura and Arunachal Pradesh; the threshold limit is Rs.10 lakhs.
How would the composition scheme work under GST?
Under GST, the composition scheme is applicable to all types of businesses with a turnover up to Rs.50 lakhs. These taxpayers will have to pay a fixed percentage of the business turnover.
Does GST apply to all businesses?
Yes. GST is applicable to all types of businesses. It applies to all the traders, manufacturers and providers. It can also extend to writers, bloggers and dealers.
Do we need different forms for IGST, SGST and CGST?
The same return form can be used for filing SGST, CGST and IGST. It will have different columns for each one of them and it will have to be filled on the basis of inter-state or intra-state supplies.
Can we revise the returns?
It is not possible to revise the GST returns. Changes can be made on the details provided in the next period’s return form amendment section
What happens if the return is not filed within the stipulated time?
In case you delay the filing of the return, you will have to pay Rs.100 per day as a late fee. The maximum late fee charge will be Rs.5000.
After filing my returns, will I be able to pay my taxes?
You cannot pay the taxes after filing the returns. Instead, it should be paid before the return filing. If it is not done so, the return will be considered invalid