GST Returns Filing

The implementation of Goods and Services Tax (GST) in many countries has revolutionized the taxation system, replacing a complex web of indirect taxes with a unified, transparent, and efficient regime. For businesses operating within the GST framework, compliance involves not only understanding the tax structure but also adhering to a meticulous GST returns filing procedure. This procedure is a crucial aspect of the GST ecosystem, ensuring that businesses report their sales, purchases, and tax liabilities accurately. In this detailed exploration, we will unravel the intricacies of the GST returns filing process, covering key aspects such as types of GST returns, timelines, and the step-by-step procedure for filing returns.

Understanding GST Returns

GST returns serve as a mechanism for businesses to furnish information to tax authorities about their financial transactions and tax payments. These returns are filed periodically, typically on a monthly or quarterly basis, depending on the nature and size of the business. The GST return filing process is comprehensive, involving the submission of details related to outward supplies, inward supplies, tax paid on purchases, and tax collected on sales. Businesses are required to file multiple types of returns, each serving a specific purpose within the GST framework.

Types of GST Returns

GSTR-1: Outward Supplies: GSTR-1 is a return that businesses need to file to provide details of their outward supplies, i.e., sales. This includes information on the type and value of supplies made during a specific tax period. GSTR-1 is typically filed on a monthly basis and is due by the 10th of the following month.

GSTR-2A: Auto-drafted Inward Supplies: GSTR-2A is an auto-generated return that captures details of inward supplies based on the information furnished by the supplier in their GSTR-1. It acts as a ready reckoner for businesses to verify the details of their purchases.

GSTR-2: Inward Supplies: GSTR-2 is a return filed by businesses to provide details of their inward supplies, i.e., purchases. It includes information on goods or services received and the input tax credit claimed. However, GSTR-2 has been temporarily suspended, and the filing process is currently subsumed within GSTR-3B.

GSTR-3B: Summary Return: GSTR-3B is a simplified return introduced to ease the transition to the GST system. It is a self-declaration summary return where businesses provide details of their outward and inward supplies along with the tax payable and input tax credit claimed. GSTR-3B is generally filed on a monthly basis by the 20th of the following month.

GSTR-4: Composition Dealer Return: GSTR-4 is filed by businesses registered under the composition scheme. This scheme is designed for small businesses, and GSTR-4 includes details of quarterly turnover and tax payable. The due date for filing GSTR-4 is the 18th of the month following the end of the quarter.

GSTR-5: Non-Resident Foreign Taxpayer Return: GSTR-5 is filed by non-resident foreign taxpayers who engage in business transactions in India. It includes details of inward and outward supplies, tax payable, and input tax credit claimed. GSTR-5 is filed within 20 days after the end of the tax period.

GSTR-6: Input Service Distributor (ISD) Return: GSTR-6 is filed by Input Service Distributors to declare the distribution of input tax credit among various branches or units. The return includes details of input tax credit received, distributed, and remaining. It is due by the 13th of the month following the tax period.

GSTR-7: Tax Deducted at Source (TDS) Return: GSTR-7 is filed by businesses required to deduct tax at source. It includes details of TDS deducted and deposited, along with details of the deductee. GSTR-7 is due on the 10th of the following month.

GSTR-8: Tax Collected at Source (TCS) Return: GSTR-8 is filed by e-commerce operators who collect tax at source on certain transactions. It includes details of supplies, tax collected, and the TCS amount deposited. GSTR-8 is due on the 10th of the following month.

GSTR-9: Annual Return: GSTR-9 is an annual return that consolidates the details provided in monthly or quarterly returns. It includes a comprehensive overview of all transactions, including outward and inward supplies, tax liability, and input tax credit. GSTR-9 is due by the 31st of December following the end of the financial year.

GSTR-9C: Reconciliation Statement and Audit Report: GSTR-9C is filed by businesses with a turnover above a specified threshold. It includes a reconciliation statement and an audit report, ensuring that the information provided in GSTR-9 aligns with the audited financial statements. GSTR-9C is due along with GSTR-9.

GST Return Filing Procedure: Step-by-Step Guide

Now, let’s delve into the step-by-step procedure for filing GST returns, considering the prevalent GSTR-3B as an example, as it is currently the primary return for most businesses:

Step 1: Access the GST Portal: Log in to the official GST portal using valid credentials. The GST portal is the online platform where businesses can manage their GST-related activities, including return filing.

Step 2: Navigate to the Returns Dashboard: Once logged in, navigate to the ‘Returns’ dashboard. Here, you will find various tabs corresponding to different types of returns. Select the relevant return, such as GSTR-3B.

Step 3: Select the Tax Period: Choose the tax period for which you want to file the return. GSTR-3B is typically filed monthly, so select the appropriate month and year.

Step 4: Fill in Outward Supplies Details (GSTR-1): GSTR-3B requires businesses to provide a summary of outward supplies. However, detailed information on outward supplies is to be filed separately in GSTR-1. Ensure that GSTR-1 for the selected period has been filed before proceeding with GSTR-3B.

Step 5: Fill in Inward Supplies Details: Provide details of inward supplies, including purchases and expenses. This information is crucial for calculating the input tax credit available.

Step 6: Calculate Tax Liability: GSTR-3B requires businesses to calculate their tax liability for the selected tax period. This involves determining the tax on outward supplies and the input tax credit available on inward supplies.

Step 7: Avail Input Tax Credit: Deduct the input tax credit from the tax on outward supplies to arrive at the net tax payable. Input tax credit can be claimed on eligible purchases, and it is essential to reconcile this with the information available in GSTR-2A.

Step 8: Fill in Other Details: Complete the remaining sections of GSTR-3B, including details of reverse charge mechanism (if applicable), interest or late fees payable (if any), and any other relevant information.

Step 9: Verify and Submit: Review all the details entered to ensure accuracy and completeness. After verification, submit the return on the GST portal. Once submitted, the return cannot be modified, so it is crucial to double-check all information.

Step 10: Pay Tax (if applicable): If there is a tax liability after considering input tax credit, make the payment through the available online modes. The payment details need to be entered on the portal.

Step 11: File the Return: After payment, the final step is to file the return. Once filed, a unique acknowledgment number is generated, confirming the successful filing of the return.

Step 12: Record Acknowledgment Number: Record the acknowledgment number generated upon successful filing. This serves as proof of filing and should be retained for future reference.

Conclusion

In conclusion, the GST return filing procedure is a critical aspect of GST compliance, demanding a systematic and accurate approach from businesses. The step-by-step process involves a series of actions, from selecting the appropriate return and tax period to providing details of outward and inward supplies, calculating tax liability, and submitting the return on the GST portal. Adherence to timelines and accuracy in reporting are paramount to avoid penalties and maintain a smooth relationship with tax authorities. As the GST framework evolves and adapts to the changing business landscape, businesses must stay abreast of updates and leverage technology to simplify the return filing process. In essence, mastering the GST returns filing procedure is not just a compliance requirement; it is a strategic imperative for businesses navigating the complexities of modern taxation systems.