GST – Goods and Service Tax

Goods and Services Tax (GST) is an indirect tax (or consumption tax) used in India on
the supply of goods and services. It is a comprehensive, multistage, destination-based tax:
comprehensive because it has subsumed almost all the indirect taxes except a few state
taxes. Multi-staged as it is, the GST is imposed at every step in the production process,
but is meant to be refunded to all parties in the various stages of production other than the
final consumer and as a destination- based tax, it is collected from point of consumption
and not point of origin like previous taxes.
Goods and services are divided into five different tax slabs for collection of tax: 0%, 5%,
12%, 18% and 28%. However, petroleum products, alcoholic drinks, and
electricity are not taxed under GST and instead are taxed separately by the individual state
governments, as per the previous tax system. There is a special rate of 0.25% on rough
precious and semi-precious stones and 3% on gold. In addition, a cess of 22% or other
rates on top of 28% GST applies on few items like aerated drinks, luxury cars and tobacco
products. Pre-GST, the statutory tax rate for most goods was about 26.5%, Post-GST, most
goods are expected to be in the 18% tax range.
The tax came into effect from 1 July 2017 through the implementation of the One Hundred
& First Amendment of the Constitution of India by the Indian Government. The GST
replaced existing multiple taxes levied by the central and state governments.
The tax rates, rules and regulations are governed by the GST Council which consists of
the finance ministers of the central government and all the states. The GST is meant to
replace a slew of indirect taxes with a federated tax and is therefore expected to reshape
the country's $2.4 trillion economy, but its implementation has received criticism. Positive
outcomes of the GST include the travel time in interstate movement, which dropped by
20%, because of disbanding of interstate check posts.

It is charged at the national and state level at similar rates for the same products and
it also replaces almost all the current indirect taxes that are imposed separately by
the Central and the States. Goods & Services Tax is a destination based tax which
means that the tax is paid at the place of supply.

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The following is the list of indirect taxes in the pre-GST rule:

 Central Excise Duty

 Duties of Excise
 Additional Duties of Excise
 Additional Duties of Customs
 Special Additional Duty of Customs
 Cess
 State VAT
 Central Sales Tax
 Purchase Tax
 Luxury Tax
 Entertainment Tax
 Entry Tax
 Taxes on advertisements
 Taxes on lotteries, betting, and gambling
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CGST, SGST, and IGST has replaced all the above taxes. However, the
chargeability of CGST for Inter-state purchase at a concessional rate of 2%, by
issue and utilization of c- Form is still prevalent for certain non-GST goods such
as:
(i) Petroleum crude;
(ii) High-speed diesel;
(iii) Motor spirit (commonly known as petrol);
(iv) Natural gas;
(v) Aviation turbine fuel; and
(vi) Alcoholic liquor for human consumption. in respect of following transactions only:

 Resale
 Use in manufacturing or processing

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 Objectives of GST
 To concentrate and conform One Country – One Tax.
 To ensure consumption-based tax instead of Manufacturing.
 To ensure Uniform GST Registration, payment and Input tax Credit.
 To eliminate the cascading effect of Indirect taxes on single transaction.
 To ensure the subsume all indirect taxes at Central and State Level under.
 To reduce tax evasion and corruption.
 To increase productivity.
 To increase Tax to GDP Ratio and Revenue surplus.
 To increase Compliance.
 To reduce economic distortions.
 Boost to exports: If Indian market will be competitive in pricing, then more and
more foreign players will try to enter the market, which results in more numbers of
exporters and benefits to Indian Market. As far there is no tax rate is finalized,
but yes GST is much needed in the countries where, it lacks
transparency and complex taxation system. GST will take away cascading
effect of various taxes that are charged on sale/ production/ purchase and so.
Products reaches to customers at very high rate as compared to manufacturing,
so with GST there will be only one tax and it will reduce burden to pay on
manufacturers.

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 Types of Goods and Service Tax (GST)
1. Central Goods and Services Tax (CGST):

Under GST, CGST is a tax levied on Intra State supplies of both goods and
services by the Central Government and will be governed by the CGST Act.
SGST will also be levied on the same Intra State supply but will be governed
by the State Government.

This implies that both the Central and the State governments will agree on
combining their levies with an appropriate proportion for revenue sharing between
them. However, its clearly mentioned in Section 8 of the GST Act that the
taxes be levied on all Intra-State supplies of goods and/or services but the rate of
tax shall not be exceeding 14%, each.

2. State Goods and Services Tax (SGST)

Under GST, SGST is a tax levied on Intra State supplies of both goods and
services by the State Government and will be governed by the SGST Act. As
explained above, CGST will also be levied on the same Intra State supply but
will be governed by the Central Government.
An example for CGST and SGST:

Let’s suppose Ram is a dealer in Karnataka who sold goods to Sham in

Karnataka worth Rs. 10,000. The GST rate is 18% comprising of CGST rate of 9%
and SGST rate of 9%. In such case, the dealer collects Rs. 1800 of which Rs.
900 will go to the Central Government and Rs. 900 will go to the Karnataka
Government

3. Integrated Goods and Services Tax (IGST):

Under GST, IGST is a tax levied on all Inter-State supplies of goods and/or
services and will be governed by the IGST Act. IGST will be applicable on

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 any supply of goods and/or services in both cases of import into India and
export from India.

An example for IGST:

Consider that a businessman Ramesh from Karnataka had sold goods to Anil
from Kerala worth Rs. 1,00,000. The GST rate is 18% comprised of 18% IGST. In
such case, the dealer has to charge Rs. 18,000 as IGST. This IGST will go to the
Central.

Advantages of GST
Advantages for the government:
 Will help to create a unified common national market for India, giving a boost to
foreign investment and “Make in India” campaign;
 Will mitigate cascading of taxes as Input Tax Credit will be available across
goods and services at every stage of supply;
 Harmonization of laws, procedures and rates of tax between Centre and States
and across States;
 Improved environment for compliance as all returns are to be filed online, input
credits to be verified online, encouraging more paper trail of transactions at each
level of supply chain;
 Similar uniform SGST and IGST rates will reduce the incentive for evasion by
eliminating rate arbitrage between neighbouring States and that between intra
and inter-state sales;
 Common procedures for registration of taxpayers, refund of taxes, uniform
formats of tax return, common tax base, common system of classification of
goods and services will lend greater certainty to taxation system;
 Greater use of IT will reduce human interface between the taxpayer and the tax
administration, which will go a long way in reducing corruption;
 It will boost export and manufacturing activity, generate more employment and
thus increase GDP with gainful employment leading to substantive

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 economic growth;
 Ultimately it will help in poverty eradication by generating more employment and
more financial resources.

Advantages to Trade and Industry:

 Increased ease of doing business;

 Reduction in multiplicity of taxes that are at present governing our indirect tax
system leading to simplification and uniformity;
 Elimination of double taxation on certain sectors like works contract, software,
hospitality sector;
 Will mitigate cascading of taxes as Input Tax Credit will be available across
goods and services at every stage of supply;
 Reduction in compliance costs - No multiple record keeping for a variety of
taxes - so lesser investment of resources and manpower in maintaining records;
 More efficient neutralization of taxes especially for exports thereby making our
products more competitive in the international market and give boost to Indian
Exports;
 Simplified and automated procedures for various processes such as registration,
returns, refunds, tax payments, etc.;
 Average tax burden on supply of goods or services is expected to come down
which would lead to more consumption, which in turn means more production
thereby helping in the growth of the industries manufacturing in India.

Advantages to Consumers:
 Final price of goods is expected to be transparent due to seamless flow of input tax
credit between the manufacturer, retailer and service supplier;
 Reduction in prices of commodities and goods in long run due to reduction in
cascading impact of taxation;
 Relatively large segment of small retailers will be either exempted from tax or

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 will suffer very low tax rates under a compounding scheme - purchases from such
entities will cost less for the consumers;
 Poverty eradication by generating more employment and more financial
resources.

Advantages to States:

 Expansion of the tax base as they will be able to tax the entire supply chain from
manufacturing to retail;
 Power to tax services, which was hitherto with the Central Government only,
will boost revenue and give States access to the fastest growing sector of the
economy;
 GST being destination based consumption tax will favour consuming States;
 Improve the overall investment climate in the country which will naturally benefit
the development in the States;
 Largely uniform SGST and IGST rates will reduce the incentive for evasion by
eliminating rate arbitrage between neighbouring States and that between intra
and inter-state sales;
 Improved Compliance levels of the tax payers will contribute greatly in
improving the revenue collection of the States.

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GST Council Meetings

GST Council has met thirteen times since its constitution and some important decisions
taken in the GST Council meeting are:-
Rules for conduct of business in GST Council;

Timetable for implementation of GST;

The threshold limit for exemption from levy of GST would be Rs. 20 lakhs for the
States except for the Special Category States, as enumerated in Article 279A of the
Constitution, for which it will be Rs 10 Lakhs);

The threshold for availing the Composition scheme would be Rs. 50 lakhs. Service
providers and some others would be kept out of the Composition Scheme;

To compensate States for 5 years for loss of revenue due to implementation of

GST, the base year for the revenue of the State would be 2015-16 and a fixed growth
rate of 14% will be applied to it;

Approval of the Draft GST Rules on registration, payment, return, refund and
invoice, debit/credit Notes with the understanding that minor changes may be
permitted with the approval of the Chairperson, if required, based on suitable
suggestions from the stakeholders or from the Law Department;

All entities exempted from payment of indirect tax under any existing tax incentive
scheme would pay tax in the GST regime and the decision to continue with any
incentive scheme shall be with the concerned State or Central

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government. In case, the State or Central Government decides to continue with any
existing exemption/incentive scheme; it will be administered by way of a
reimbursement mechanism.
Adoption of four slabs tax rate structure of 5%, 12%, 18% and 28%. In addition, there
would be a category of exempt goods and further a cess would be levied on certain
goods such as luxury cars, aerated drinks, pan masala and tobacco products, over and
above the rate of 28% for payment of compensation to the states.
GST rates on 1211 items were approved at the 14th GST Council meeting held at
Srinagar on 18th and 19th of May 2017.

At the 15th GST Council meeting held at New Delhi on 3rd June 2017, tax rates on
the remaining goods were approved
22 states, and 2 Union Territories with Legislatures (Delhi and Puducherry) have
already passed their respective State GST Bill in their State Assemblies.
Issue of cross empowerment and administrative division of taxpayers between the
States and Centre has been resolved.

The implementation of GST has the following challenges:

Challenging time frame of rolling out GST by 1st July, 2017;

Infrastructure and Technology up-gradation of tax system particularly of the
States;
Up-gradation of IT systems of trade & industry;

Taxes which are not to be subsumed

GST may not subsume the following taxes within its ambit:

1. Basic Custom Duty: These are protective duties levied at the time of
Import ofgoods into India.
2. Export Duty: This duty is imposed at the time of export of certain

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 goods which are not available in India in abundance.
3. Road and Passenger Tax: These are in the nature of fees and not in the
nature of taxes on goods and services.
4. Toll tax: these are in the nature of user fees and not in the nature of
taxes on goods and services.

Various Tax Rates imposed by GST

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 Registration under GST Law
In any tax system registration is the most fundamental requirement for identification
of tax payers ensuring tax compliance in the economy. Registration of any business
entity under the GST Law implies obtaining a unique number from the concerned tax
authorities for the purpose of collecting tax on behalf of the government and to avail
Input tax credit for the taxes on his inward supplies. Without registration, a person can
neither collect tax from his customers nor claim any input tax credit of tax paid by him.

Need and advantages of registration

Registration will confer the following advantages to a taxpayer:
 He is legally recognized as supplier of goods or services.
 He is legally authorized to collect tax from his customers and pass on the credit
of the taxes paid on the goods or services supplied to the purchasers/ recipients.
 He can claim input tax credit of taxes paid and can utilize the same for payment of
taxes due on supply of goods or services.
 Seamless flow of Input Tax Credit from suppliers to recipients at the national level.

Liability to register
GST being a tax on the event of “supply”, every supplier needs to get registered.
However, small businesses having all India aggregate turnover below Rupees
20 lakh (10lakh if business is in Assam, Arunachal Pradesh, Himachal Pradesh,
Uttarakhand, Manipur, Mizoram, Sikkim, Meghalaya, Nagaland or Tripura) need not
register. The small businesses, having turnover below the threshold limit can, however,
voluntarily opt to register.
The aggregate turnover includes supplies made by him on behalf of his principals, but
excludes the value of job-worked goods if he is a job worker. But persons who are
engaged exclusively in the business of supplying goods or services or both that are not
liable to tax or wholly exempt from tax or an agriculturist, to the extent of supply of
produce out of cultivation of land are not liable to register under GST.

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Also, if all the supplies being made by a supplier are taxable under reverse charge, there
is no requirement for such a supplier to register in light of Notification No. 5/2017-
Central Tax dated 19.06.2017.

Nature of Registration

The registration in GST is PAN based and State specific.

Supplier has to register in each of such State or Union territory from where he effects
supply. In GST registration, the supplier is allotted a 15-digit GST identification
number called “GSTIN” and a certificate of registration incorporating therein this
GSTIN is made available to the applicant on the GSTN common portal. The first 2
digits of the GSTIN is the State code, next 10 digits are the PAN of the legal entity,
the next two digits are for entity code, and the last digit is check sum number.
Registration under GST is not tax specific which means that there is single
registration for all the taxes i.e. CGST, SGST/UTGST, IGST and cesses.
A given PAN based legal entity would have one GSTIN per State, that means a business
entity having its branches in multiple States will have to take separate State wise
registration for the branches in different States. But within a State an entity with different
branches would have single registration wherein it can declare one place as principal
place of business and other branches as additional place of business. However, a
business entity having separate business verticals (as defined in section 2 (18) of the
CGSTAct, 2017) in a state may obtain separate registration for each of its business
verticals. Further a unit in SEZ or a SEZ developer needs to necessarily obtain separate
registration.

 Generally, the liability to register under GST arises when you are a supplier
within the meaning of the term, and also if your aggregate turn over in the
financial year is above the exemption threshold of20 lakh rupees (10 lakh
rupees in special category states except J & K). However, the GST law enlists
certain categories of suppliers who are required to get compulsory registration
irrespective of their turnover that is to say, the threshold exemption of20
lakh rupees or 10 lakh rupees as the case may be is not available to them.
Some of such suppliers who need to register compulsorily irrespective of the size
of their turnover are those who are,-

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 Inter-state suppliers; However, persons making inter-state supplies of taxable
services and having an aggregate turnover, to be computed on all India basis, not
exceeding an amount of twenty lakh rupees(ten lakh rupees for special category
States except J & K) are exempted from obtaining registration vide Notification
No. 10/2017-Integrated Tax dated 13.10.2017.
 A person receiving supplies on which tax is payable by recipient on reverse
charge basis
 Casual taxable person who is not having fixed place of business in the State or
Union Territory from where he wants to make supply. However casual taxable
persons making supplies of specified handicraft goods need not take compulsory
registration and are entitled to the threshold exemption of Rs. 20 Lakh.
Handicraft goods are specified in Notification no. 33/2017-Central Tax dated
15.09.2017 as amended by Notification no. 38/2017-Central Tax dated
13.10.2017.

 non-resident taxable persons who is not having fixed place of business in

India
 A person who supplies on behalf of some other taxable person (i.e. an Agent of
some Principal)
 E-commerce operators, who provide platform to the suppliers to make supply
through it
 Suppliers of goods who supply through such e-commerce operator who are
liable to collect tax at source. Persons supplying services through e- commerce
operators need not take compulsory registration and are entitled to avail the
threshold exemption of Rs. 20 Lakh as per Notification No. 65/2017-Central tax
dated 15.11.2017.
 Those ecommerce operators who are notified as liable for GST payment under
Section 9(5) of the CGST Act, 2017
 TDS Deductor
 Input service distributor
 Those supplying online information and data base access or retrieval services
from outside India to anon-registered person in India.

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A casual taxable person is one who has a registered business in some State in India, but wants
to effect supplies from some other State in which he is not having any fixed place of
business. Such person needs to register in the State from where he seeks to supply as a
casual taxable person. A non-resident taxable person is one who is a foreigner and
occasionally wants to effect taxable supplies from any State in India, and for that he
needs GST registration. GST
law prescribes special procedure for registration, as also for extension of the operation period
of such casual or non- resident taxable persons. They have to apply for registration at
least five days in advance before making any supply. Also, registration is granted to
them or period of operation is extended only after they make advance deposit of the
estimated tax liability.
In respect of supplies to some notified agencies of United Nations organization,
multinational financial institutions and other organizations’, a centralized unique
identification number (UIN) is issued.

Documents Required for GST Registration

 PAN of the Applicant.

 Aadhaar Card.
 Proof of business registration or Incorporation certificate.
 Identify and Address proof of Promoter.
 Address proof of the place of business.
 Bank Account statement/ Cancelled cheque
 Digital Signature.
 Letter of Authorization/ Board Resolution of Authorized signatory

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48
GST Composition Scheme
Composition Scheme is a simple and easy scheme under GST for taxpayers.
Small taxpayers can get rid of tedious GST formalities and pay GST at a fixed
rate of turnover. This scheme can be opted by any taxpayer whose turnover is
less than Rs. 1.0 crore*.

*CBIC has notified the increase to the threshold limit from Rs 1.0 Crore to
Rs. 1.5Crores.
Who can opt for Composition Scheme
A taxpayer whose turnover is below Rs 1.0 crore* can opt for Composition
Scheme. Incase of North-Eastern states and Himachal Pradesh, the limit is now
Rs 75* lakh.

As per the CGST (Amendment) Act, 2018, a composition dealer can also supply
services to an extent of ten percent of turnover, or Rs.5 lakhs, whichever is higher.
This amendment will be applicable from the 1st of Feb, 2019. Further, GST
Council in its 32nd meeting proposed an increase to this limit for service providers
on 10th Jan 2019*.

Turnover of all businesses registered with the same PAN should be

taken into consideration to calculate turnover.

Who cannot opt for Composition Scheme

The following people cannot opt for the scheme-

 Manufacturer of ice cream, pan masala, or tobacco

 A person making inter-state supplies
 A casual taxable person or a non-resident taxable person
 Businesses which supply goods through an e-commerce operator

What are the conditions for availing Composition Scheme?

The following conditions must be satisfied in order to opt for composition scheme:

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  No Input Tax Credit can be claimed by a dealer opting for composition
scheme
 The dealer cannot supply GST exempted goods
 The taxpayer has to pay tax at normal rates for transactions under the
Reverse Charge Mechanism
 If a taxable person has different segments of businesses (such as textile,
electronic accessories, groceries, etc.) under the same PAN, they must
register all such businesses under the scheme collectively or opt out of the
scheme.
 The taxpayer has to mention the words ‘composition taxable person’ on
every notice or signboard displayed prominently at their place of
business.
 The taxpayer has to mention the words ‘composition taxable person’ on
every bill of supply issued by him.

As per the CGST (Amendment) Act, 2018, a manufacturer or trader can now also
supply services to an extent of ten percent of turnover, or Rs.5 lakhs,
whichever is higher. This amendment will be applicable from the 1st of Feb,
2019.

How can a taxpayer opt for composition scheme?

To opt for composition, scheme a taxpayer has to file GST CMP-02 with the
government. This can be done online by logging into the GST Portal.

This intimation should be given at the beginning of every Financial Year by a dealer
wanting to opt for Composition Scheme.

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 How Should a Composition Dealer raise bill?

A composition dealer cannot issue a tax invoice. This is because a composition dealer
cannot charge tax from their customers. They need to pay tax out of their own pocket.
Hence, the dealer has to issue a Bill of Supply.
The dealer should also mention “composition taxable person, not eligible to collect tax
on supplies” at the top of the Bill of Supply.

How should GST payment be made by a composition dealer?

GST Payment has to be made out of pocket for the supplies made.

The GST payment to be made by a composition dealer comprises of the following:

 GST on supplies made.

 Tax on reverse charge
 Tax on purchase from an unregistered dealer*
*Only on the specified categories of goods and services and well as the notified class of
registered persons with effect from 1st Feb 2019 but is yet to be notified. Hence, not
applicable until then.

What are the returns to be filed by a composition dealer?

A dealer is required to file a quarterly return GSTR-4 by 18th of the month after the
end of the quarter. Also, an annual return GSTR-9A has to be filed by 31st December of
next financial year*.

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What are the GST rates for a composition dealer?

Following chart explains the rate of tax on turnover applicable for composition dealers :

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Input Tax Credit
Input credit means at the time of paying tax on output, you can reduce the tax
you have already paid on inputs and pay the balance amount.

Here’s how-

When you buy a product/service from a registered dealer you pay taxes on the
purchase. On selling, you collect the tax. You adjust the taxes paid at the time
of purchase with the amount of output tax (tax on sales) and balance liability
of tax (tax on sales minus tax on purchase) has to be paid to the government.
This mechanism is called utilization of input tax credit.

For example- you are a manufacturer: a. Tax payable on output (FINAL

PRODUCT) is Rs 450 b. Tax paid on input (PURCHASES) is Rs 300 c. You
can claim INPUT CREDITof Rs 300 and you only need to deposit Rs 150 in taxes.

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Who can claim ITC?

ITC can be claimed by a person registered under GST only if he fulfills ALL the
conditions as prescribed.

a. The dealer should be in possession of tax invoice

b. The said goods/services have been received

c. Returns have been filed.

d. The tax charged has been paid to the government by the supplier.

e. When goods are received in installments ITC can be claimed only when the last
lot is received.

f. No ITC will be allowed if depreciation has been claimed on tax component of a

capital good

What can be claimed as ITC?

ITC can be claimed only for business purposes. ITC will not be available for
goods or services exclusively used for: a. Personal use b. Exempt supplies c.
Supplies for whichITC is specifically not available.

How to claim ITC?

All regular taxpayers must report the amount of input tax credit (ITC) in their
monthly GST returns of Form GSTR-3B. The table 4 requires the summary figure of
eligible ITC,Ineligible ITC and ITC reversed during the tax period. The format of
the Table 4 is given below:

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 Reversal of Input Tax Credit

ITC can be availed only on goods and services for business purposes. If they are used for
non-business (personal) purposes, or for making exempt supplies ITC cannot be
claimed .Apart from these, there are certain other situations where ITC will be reversed.

ITC will be reversed in the following cases-

1) Non-payment of invoices in 180 days– ITC will be reversed for invoices which were
not paid within 180 days of issue.

2) Credit note issued to ISD by seller– This is for ISD. If a credit note was issued
by the seller to the HO then the ITC subsequently reduced will be reversed.

3) Inputs partly for business purpose and partly for exempted supplies or for
personal use – This is for businesses which use inputs for both business and non-
business (personal) purpose. ITC used in the portion of input goods/services
used for the personal purpose must be reversed proportionately.

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 4) Capital goods partly for business and partly for exempted supplies or for
personal use – This is similar to above except that it concerns capital goods.

5) ITC reversed is less than required- This is calculated after the annual return is
furnished. If total ITC on inputs of exempted/non-business purpose is more than the
ITCactually reversed during the year then the difference amount will be added to
output liability. Interest will be applicable.

6) The details of reversal of ITC will be furnished in GSTR-3B. To find out more
about the segregation of ITC into business and personal use and subsequent
calculations, please visit our article.
Special cases of ITC

 ITC for Capital Goods.

 ITC on Job work.
 ITC provided by Input service distributor.
 ITC on Transfer of Business.

Stages of GST

There are multiple change-of-hands an item goes through along its supply chain:
from manufacture to final sale to the consumer.

Let us consider the following case:

1. Purchase of raw materials.

2. Production or manufacture.
3. Warehousing of finished goods.
4. Sale to wholesaler.

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 5. Sale of the product to the retailer.
6. Sale to the end consumer.

Goods and Service Tax is levied on each of these stages which makes it is multi stage tax.

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Types of GST Returns

GSTR-1

GSTR-1 is the return to be furnished for reporting details of all outward

supplies of goods and services made, or in other words, sales transactions made
during a tax period, and also for reporting debit and credit notes issued. Any
amendments to sales invoices made, even pertaining to previous tax periods,
should be reported in the GSTR-1 return.

GSTR-1 is to be filed by all normal taxpayers who are registered under GST.
It is to befiled monthly, except in the case of small taxpayers with turnover up to
Rs.1.5 crore in the previous financial year, who can file the same on a quarterly
basis.

GSTR-2A

GSTR-2A is the return containing details of all inward supplies of goods and
services i.e., purchases made from registered suppliers during a tax period. The
data is auto-populated based on data filed by the suppliers in their GSTR-1 return.
GSTR-2A is a read-only return and no action can be taken.

GSTR-2

GSTR-2 is the return for reporting the inward supplies of goods and services i.e.,
the purchases made during a tax period. The details in the GSTR-2 return are
auto-populated from the GSTR-2A. Unlike GSTR-2A, the GSTR-2 return can
be edited.

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GSTR-2 is to be filed by all normal taxpayers registered under GST, however, the filing of
the same has been suspended ever since the inception of GST.

GSTR-3

GSTR-3 is a monthly summary return for furnishing summarized details of all

outward supplies made, inward supplies received and input tax credit claimed,
along with details of the tax liability and taxes paid. This return is auto-
generated on the basis of the GSTR-1 and GSTR-2 returns filed.

GSTR-3 is to be filed by all normal taxpayers registered under GST, however,

the filing of the same has been suspended ever since the inception of GST.

GSTR-3B
GSTR-3B is a monthly self-declaration to be filed, for furnishing
summarized details of all outward supplies made, input tax credit claimed,
tax liability ascertained and taxes paid.

GSTR-3B is to be filed by all normal taxpayers registered under GST.

GSTR-4 / CMP-08
GSTR-4 is the return that was to be filed by taxpayers who have opted for the
Composition Scheme under GST. CMP-08 is the return which has replaced the
now erstwhile GSTR-4. The Composition Scheme is a scheme in which
taxpayers with turnover up to Rs.1.5 crores can opt into and pay taxes at a
fixed rate on the turnover declared.

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 The CMP-08 return is to be filed on a quarterly basis.

GSTR-5

GSTR-5 is the return to be filed by non-resident foreign taxpayers, who are

registered under GST and carry out business transactions in India. The return
contains details of all outward supplies made, inward supplies received,
credit/debit notes, tax liability and taxes paid.

The GSTR-5 return is to be filed monthly for each month that the taxpayer is
registered under GST in India.

GSTR-6
GSTR-6 is a monthly return to be filed by an Input Service Distributor (ISD). It
will contain details of input tax credit received and distributed by the ISD. It will
further contain details of all documents issued for the distribution of input
credit and the manner of distribution.

GSTR-7

GSTR-7 is a monthly return to be filed by persons required to deduct TDS

(Tax deducted at source) under GST. GSTR 7 will contain details of TDS
deducted, the TDS liability payable and paid and TDS refund claimed, if any.

GSTR-8

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 GSTR-8 is a monthly return to be filed by e-commerce operators registered
under the GST who are required to collect tax at source (TCS). GSTR-8 will
contain details of all supplies made through the E-commerce platform, and the
TCS collected on the same.

The GSTR-8 return is to be filed on a monthly basis.

GSTR-9
GSTR-9 is the annual return to be filed by taxpayers registered under GST. It
will contain details of all outward supplies made, inward supplies received during
the relevant previous year under different tax heads i.e. CGST, SGST & IGST
and HSN codes, along with details of taxes payable and paid. It is a consolidation
of all the monthly or quarterly returns (GSTR-1, GSTR-2A, GSTR-3B) filed
during that year.

GSTR-9 is required to be filed by all taxpayers registered under GST*, except

taxpayers who have opted for the Composition Scheme, Casual Taxable Persons,
Input Service Distributors, Non-resident Taxable Persons and persons paying TDS
under section 51 ofCGST Act.

*The 37th GST Council meeting took the decision to make GSTR-9 filing optional
for businesses with turnover up to Rs.2 crore in FY 17-18 and FY 18-19.

GSTR-9A
GSTR-9A is the annual return to be filed by taxpayers who have register. under the
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Composition Scheme in a financial year*. It is a consolidation of all the quarterly
returns filed during that financial year.

*GSTR-9A filing for Composition taxpayers has been waived off for FY 2017-

18 and FY2018-19 as per the decision taken in the 27th GST Council meeting.

GSTR-9C
GSTR-9C is the reconciliation statement to be filed by all taxpayers registered
under GST whose turnover exceeds Rs.2 crore in a financial year. The registered
person has to get their books of accounts audited by a Chartered/Cost
Accountant. The statement of reconciliation is between these audited financial
statements of the taxpayer and the annual return GSTR-9 that has been filed.

GSTR-9C is to be filed for every GSTIN, hence, one PAN can have multiple
GSTR-9Cforms being filed.

GSTR-10
GSTR-10 is to be filed by a taxable person whose registered has been cancelled or
surrendered. This return is also called a final return and has to be filed within 3 months
from the date of cancellation or cancellation order, whichever is earlier.

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GSTR-11

GSTR-11 is the return to be filed by persons who have been issued a Unique
Identity Number (UIN) in order to get a refund under GST for the goods and
services purchased by them in India. UIN is a classification made for foreign
diplomatic missions and embassies not liable to tax in India, for the purpose of
getting a refund of taxes. GSTR-11will contain details of inward supplies received
and refund claimed

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Due Dates of filing GST Returns

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 Late filing of GST Returns
 Return filing is mandatory under GST. Even if there is no
transaction, you must file a Nil return.
 You cannot file a return if you do not file previous month/quarter’s return.
 Hence, late filing of GST return will have a cascading effect leading to
heavy fines and penalty.
 The late filing fee of the GSTR-1 is populated in the liability ledger of
GSTR-3Bfiled immediately after such delay.

Interest/late fees to be paid

 Interest is 18% per annum. It has to be calculated by the taxpayer on the

amount of outstanding tax to be paid. It shall be calculated on the Net tax
liability identified in the ledger at the time of payment. The time period
will be from the next day of filing due date till the actual date of
payment.

 As per GST Act Late fee is Rs. 100 per day per Act. So it is 100 under
CGST & 100 under SGST. Total will be Rs. 200/day. The maximum is
Rs. 5,000. There is no late fee on IGST.

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