GST Return - What is GST Return? Who Should File, Due Dates & Types of GST Returns

Author- Tanvi Thapliyal

Taxation is often perceived as a one-directional obligation where taxpayers feel that a significant portion of their earnings must be handed over to the government in the form of taxes. This leads some individuals to commit tax evasion, either by not paying taxes at all or by employing illegitimate methods to minimise their tax liabilities. However, a closer examination of both direct and indirect taxation reveals that only a fraction of one's total income is actually taken as tax, which is carefully calculated and levied by the tax authorities.

Another common misconception surrounds the nature of indirect taxes. Some believe that taxes on goods are paid repeatedly - first when purchasing goods and then again when selling them. This misunderstanding overlooks the comprehensive tax return mechanisms in place in India, designed to prevent double taxation on any item. These tax returns are organised into specific forms based on various types and compliance requirements.

For example, the compliance calendar for February, provided by TaxPartner https://www.linkedin.com/posts/tax-partner-fhh_compliance-due-date-for-the-month-of-february-activity-7160518241868484608-uBPl?utm_source=share&utm_medium=member_desktop - your reliable guide for all tax-related matters, highlights three key compliances: GSTR-1, GSTR-3B, and GSTR, all related to GST returns. This indicates the importance of staying attentive to GST obligations. One might wonder why there are multiple forms related to GST and how to discern eligibility or determine which goods and supplies fall under each category.

By the conclusion of this article, all such questions will be addressed, ensuring you have a clear understanding of your tax return obligations and how to navigate them effectively

What is GST?

GST, an abbreviation for Goods and Services Tax, is a thorough, multi-stage, destination-based tax imposed on each value addition. Implemented in India on July 1, 2017, GST replaced numerous indirect taxes that were previously in place, marking it as a significant tax reform in the country. The primary concept of GST is to establish a unified market by simplifying the tax structure on goods and services nationwide.

Important Aspects of GST:

• Multiple stages:GST is applied at each phase of the production process but is intended to be reimbursed to all involved parties except the ultimate consumer.

• Destination-based: Tax is collected from the point of consumption and not the point of origin like previous tax systems.

• Input Tax Credit: This functionality enables businesses to claim credit for the taxes paid on their purchases, thereby lowering the tax they must pay on the sale of their goods or services.

There are four types of GST based on the application:

• CGST is imposed on transactions within a state and is collected by the Central Government.
• SGST: Additionally imposed on transactions within a state and gathered by the State Government.
• IGST (Integrated Goods and Services Tax) is imposed on transactions between different states and on imports, and it is collected by the Central Government.
• UTGST (Union Territory Goods and Services Tax): Imposed on transactions within Union Territories without their own legislatures, collected by the Union Territory Government.

Goals of GST:

• To get rid of the cascading effect of taxes, where taxes were previously imposed on an already taxed amount, resulting in higher overall taxes.
• Consolidating multiple indirect taxes into a single tax simplifies tax administration and enforcement.
• Enhancing the overall efficiency of the tax system to simplify processes for businesses and stimulate economic growth.
• GST has played a crucial role in establishing a transparent and competitive business environment in India through the simplification of the tax structure and the uniform taxation of goods and services nationwide.

What Is Meant By GST Return

A GST Return is a document that includes information about income that a taxpayer, registered under GST, must submit to the tax administrative authorities. This is utilised by tax authorities for determining tax liability. Under the GST system, a registered dealer must submit GST returns containing information on purchases, sales, output GST (on sales), and input tax credit (ITC) (GST paid on purchases).

For filing GST returns, you need to have sales and purchase invoices that comply with GST regulations. The GST system has been created to facilitate electronic filing of returns, streamlining the process for users. Multiple types of GST returns need to be submitted by various groups of taxpayers.

GST Returns Under The CGST Act 2017

CGST Act 2017 specifically states that the Monthly, Quarterly and Annual Returns are compulsory to be filled even though no transactions are to be reported. Nil Return has to be submitted.

The Central Goods and Services Tax (CGST) Act, 2017, offers a detailed framework for the imposition and gathering of tax on intra-state supplies of goods and services. Several sections within this legislative framework specifically cover the requirements, procedures, and conditions concerning the filing of tax returns under GST. Important sections covering tax returns are:

Section 37: Providing Information on Outward Supplies

This section requires all registered individuals to provide electronically the information about outward supplies of goods or services, including any changes, within specified deadlines. Usually, this is accomplished by submitting Form GSTR-1.

Section 38: Providing Information on Received Supplies

The registered individual must verify, validate, modify, or delete the details of inward supplies, and provide the details of taxable goods and services that are not auto-populated. Nevertheless, the procedure for this section has undergone practical modifications with the introduction of GSTR-2A and GSTR-2B as auto-drafted statements to assist in the reconciliation process.

Section 39: Providing Returns

This part is crucial for the GST returns filing procedure. The document explains the responsibilities of various taxpayers to submit monthly, quarterly, or other regular reports outlining their tax obligations, input tax credit claimed, and other specified details. The group consists of regular taxpayers submitting GSTR-3B, composite dealers submitting GSTR-4, and others.

Section 40: Initial Submission

This part discusses the process of submitting the initial return by an individual who is now required to register under GST or has opted for voluntary registration.

Section 44: Annual Return

An annual return must be filed by every registered individual, with some exceptions as specified. Additionally, it also discusses the requirement to file an audit report in Form GSTR-9C for taxpayers with turnover exceeding the specified limit.

Section 45: Final Return

When registration is cancelled or surrendered, the taxpayer must submit a final return within a designated time frame.

Who Files GST Returns?

Under the GST framework, regular businesses with a yearly total turnover above Rs. 5 crore (and those not enrolled in the Quarterly Return Monthly Payment (QRMP) scheme) must file two monthly returns and one annual return, making it a total of 25 returns per year.

For businesses with turnovers up to Rs. 5 crore, the QRMP scheme offers an alternative. According to this plan, QRMP filers must submit a total of 9 returns annually, including 4 GSTR-1 and GSTR-3B returns each, along with an annual return. It is crucial to remember that even though returns are filed quarterly, participants in the QRMP must pay taxes monthly.

Furthermore, certain situations like composition dealers require distinct statements or returns, resulting in a total of 5 GSTR filings annually. This consists of 4 statement-cum-challans in CMP-08 and 1 annual return in GSTR-4.

What Is QRMP Scheme?

The Quarterly Return Monthly Payment (QRMP) scheme is a choice available under the Goods and Services Tax (GST) system in India. It enables qualified taxpayers to submit their GST returns quarterly and make monthly payments for tax obligations.

With the QRMP scheme, taxpayers have the option to submit their GSTR-1 (outward supplies details) quarterly and GSTR-3B (summary return of outward supplies and input tax credit) monthly. This plan is designed to lessen the burden on small taxpayers while also ensuring consistent tax payments to the government.

Individuals qualified for the QRMP scheme have an aggregate turnover of up to Rs. 5 crore in the previous financial year. Individuals can choose this scheme to enjoy fewer return filings and ensure prompt tax payments. It's worth mentioning that even though returns are filed quarterly, taxpayers under the QRMP scheme must pay taxes monthly.

Overall, the QRMP scheme streamlines GST compliance for small taxpayers by providing a more manageable approach to return filing and tax payment.

Classification Of GST Returns Under The GST?

There are 13 different returns in the GST framework: GSTR-1, GSTR-3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR-7, GSTR-8, GSTR-9, GSTR-10, GSTR-11, CMP-08, and ITC-04. It's crucial to highlight that the requirement to submit these returns differs based on the taxpayer's classification and registration type.

In addition, taxpayers with a turnover exceeding Rs. 5 crore must provide a self-certified reconciliation statement using Form GSTR-9C.

Aside from the necessary GST returns, taxpayers also receive statements that show their input tax credit status, specifically GSTR-2A (dynamic) and GSTR-2B (static). Additionally, individuals registered under the QRMP scheme can utilise the Invoice Furnishing Facility (IFF) to record their Business to Business (B2B) sales for the first two months of the quarter. It is important to highlight that even with the quarterly return filing, these small taxpayers must still pay taxes monthly using Form PMT-06.

In the following section, you will find comprehensive information about different GST returns, such as when they are applicable and their respective deadlines.

List Of Returns To Be Filed Under The GST Law Along With Due Dates

Why GSTR 3B Have Two Different Frequency Dates

For taxpayers with an aggregate turnover equal to or below Rs. 5 crore, who are eligible and choose to remain opted into the QRMP scheme, the due date for filing returns is the 22nd of the month following the quarter for taxpayers in Category X states/UTs, and the 24th of the month following the quarter for taxpayers in Category Y states/UTs.

Category X states/UTs include Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, as well as the Union territories of Daman and Diu, Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands, and Lakshadweep.

Category Y states/UTs comprise Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand, Odisha, as well as the Union Territories of Jammu and Kashmir, Ladakh, Chandigarh, and New Delhi.

Why GSTR 2 & 3 Missing From GSTR List

The GSTR-2 and GSTR-3 forms, initially introduced under the Goods and Services Tax (GST) regime, aimed to streamline the process of matching input tax credit (ITC) claimed by buyers with the information of outward supplies provided by their suppliers in GSTR-1. Nevertheless, because of technical and operational difficulties, these forms are no longer available as decided by the GST Council.

The decision to discontinue GSTR-2 and GSTR-3 forms was mainly because of the challenges in reconciling extensive data between buyers and suppliers. The manual matching process was discovered to be burdensome and error-prone, resulting in delays and inefficiencies in the GST system.

To simplify the GST return filing process and tackle these issues, the GST Council opted to introduce new forms like GSTR-1 for outward supplies and GSTR-3B for summary returns. The forms were designed to lessen the burden on taxpayers while maintaining the efficiency of the GST system.

Conclusion-

The Central Board of Indirect Taxes and Customs (CBIC) is a vital statutory body responsible for overseeing various indirect taxes in India. Through issuing timely notifications, CBIC plays a crucial role in policy formulation, tax administration, and enforcement to prevent tax evasion. It oversees the entire tax regime, including the Goods and Services Tax (GST).

CBIC regularly updates the GST return regime, reflecting any necessary changes to ensure compliance and streamline operations for businesses. Understanding the requirements for filing GST returns is essential for businesses operating under the GST regime. Compliance with different GSTR forms is necessary to maintain smooth operations and avoid penalties.

Given the complexity of GST returns, it is advisable for taxpayers to seek expert advice and consultation periodically. Understanding and navigating the nuances of GST returns can be challenging, and professional guidance can help ensure accurate compliance and minimise risks associated with taxation.

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FAQ’S

1. What is a GST return?

A GST return is a document containing details of income, expenses, and tax liabilities that a taxpayer is required to file with tax authorities under the Goods and Services Tax (GST) regime.

2. Who should file GST returns?

All businesses registered under GST, including regular taxpayers, composition dealers, non-resident taxable persons, and Input Service Distributors, are required to file GST returns.

3. What are the different types of GST returns?

The various types of GST returns include GSTR-1 (for outward supplies), GSTR-3B (for summary returns), GSTR-4 (for composition dealers), GSTR-9 (annual return), and more, catering to specific taxpayer categories and activities.

4. What is the due date for filing GST returns?

The due dates for filing GST returns vary depending on the type of return and the turnover of the taxpayer. Generally, monthly returns are due by the 20th of the following month, while annual returns are due by December 31st of the next financial year.

5. What happens if GST returns are not filed on time?

Late filing of GST returns may attract penalties and interest charges. It is crucial for taxpayers to adhere to the prescribed due dates to avoid such consequences.

6. Can I revise my GST returns?

Yes, taxpayers can revise their GST returns if any errors or omissions are identified after filing. However, revisions must be made within the specified time limit and in accordance with GST rules.

7. Do I need to file GST returns if my business turnover is below the threshold?

Even if your business turnover is below the threshold for mandatory GST registration, you may still choose to voluntarily register under GST and file returns to avail of input tax credit and other benefits.

8. Where can I get assistance with filing GST returns?

Tax professionals, accounting firms, and GST service providers like Taxpartner offer expert assistance and support for filing GST returns accurately and efficiently.

9. What documents are required for filing GST returns?

The documents required for filing GST returns typically include invoices issued for sales and purchases, details of input tax credit availed, records of outward and inward supplies, and any other relevant documents as per GST regulations.

10. Is there any penalty for incorrect filing of GST returns?

Yes, incorrect filing of GST returns, such as providing inaccurate information or under-reporting sales, may lead to penalties levied by tax authorities. It is essential for taxpayers to ensure the accuracy and completeness of their GST returns to avoid penalties and other repercussions.