Any person or business registered under the GST scheme of India must file GST returns on either a monthly, quarterly, or annual basis as a part of the legal requirement. GST return filing is done to report one’s income and calculate the taxes you owe to the government. It also helps calculate the ITC claims you’re eligible for.
Here, we shall discuss everything about GST return filing, its process, different types of GST returns, their due dates, and penalties you’d be liable to pay in case you miss filing your GST returns on time.
What is a GST Return?
A GST return is a document that contains the details of any registered taxpayer/business’s business transactions. Typically, GST returns summarise business finances for a specified period, whether monthly, quarterly, or annually.
Based on these GST returns, the total tax amounts the business is leviable to pay to the government are derived. Lately, GST returns serve multiple purposes; they help with audits, ITC claims amount, refund you would be eligible to receive, and more.
Key Components of a GST Return
Different GST returns serve different purposes and hence have varied components. Some of these components are:
Sales
The GST return filing lists down the details of all sales made by the business during the reporting period. This includes taxable supplies of goods and services.
Purchases
The GST returns also list all the purchases made by the business for a specific period. This helps in claiming input tax credits for taxes paid on purchases.
Output Tax
The registered taxpayers shall report GST collected on sales (output tax) in the GST return filings. This is the tax amount collected from customers on behalf of the government.
Input Tax Credits
The businesses shall report GST paid on purchases (input tax) in the GST returns. This is the tax amount the business pays on its purchases, which can be offset against the output tax liability.
Tax Liability
After reconciling various returns, the return calculates the net tax liability or a refundable amount based on the output tax and input tax credits. If the output tax exceeds the input tax credits, the business must remit the difference to the tax authorities. If the input tax credits exceed the output tax, the business/ company is eligible for a refund.
Other Details
Depending on the tax jurisdiction, the return may also require additional information, such as details of exempt supplies, zero-rated supplies, and any adjustments or corrections to previous returns.
Who Files GST Returns?
Various entities file GST returns for different purposes, including:
- Businesses registered under GST: This includes all regular taxpayers who are required to file monthly or quarterly returns.
- Taxpayers eligible for the Composition Scheme: These are small taxpayers who opt for a simplified tax scheme and file annual returns.
- E-commerce operators: Entities that facilitate online sales and are required to file monthly returns.
- Input Service Distributors (ISD): Entities that distribute input tax credit to their branches and file monthly returns.
- Non-resident taxable persons: Foreign entities doing business in India, required to file monthly returns.
- Entities with nil transactions: Businesses that had no transactions during a tax period must file nil returns.
Types of GST Returns and Their Due Dates
Many GST returns are to be filed by a taxpayer based on the information one is to furnish for the financial year. You should note that over the years, government has introduced new returns and also suspended some existing returns to streamline GST return filing for taxpayers.
We have listed the different types of GST returns below, including active, suspended, view-only, and other important returns along with important GST returns due dates:
| GST Return Type | Purpose | Who Files It | Due Date |
|---|---|---|---|
| GSTR-1 | Report outward supplies of goods or services | Regular taxpayers | Monthly by the 11th or quarterly by the 13th |
| GSTR-1A | Amend details of outward supplies reported in GSTR-1 | Regular taxpayers | Before filing GSTR-3B |
| GSTR-2 | Report inward supplies of goods or services (suspended) | Regular taxpayers | Currently suspended |
| GSTR-2A | View-only statement of inward supplies | Auto-drafted for recipients | Available for viewing and reconciliation |
| GSTR-2B | View-only ITC statement | Auto-drafted for recipients | Available for viewing and reconciliation |
| GSTR-3 | Monthly return based on finalization of outward and inward supplies (suspended) | Regular taxpayers | Currently suspended |
| GSTR-3B | Declare summary of outward supplies, input tax credit, and tax liability | Regular taxpayers | Monthly by the 20th |
| GSTR-4 | Annual return summarizing quarterly CMP-08 statements | Composition taxpayers | Annually by the 30th of April |
| GSTR-5 | Report business transactions in India | Non-resident taxable persons | Monthly by the 20th or within 7 days after expiry of registration |
| GSTR-5A | Report supplies to non-taxable persons in India | Non-resident OIDAR service providers | Monthly by the 20th |
| GSTR-6 | Distribute input tax credit to branches | Input service distributors | Monthly by the 13th |
| GSTR-6A | View-only statement for input service distributors | Auto-drafted for ISDs | Available for viewing and reconciliation |
| GSTR-7 | Report tax deducted and paid | TDS deductors | Monthly by the 10th |
| GSTR-8 | Report supplies made through the platform and TCS collected | E-commerce operators | Monthly by the 10th |
| GSTR-9 | Annual return summarizing monthly or quarterly returns | Regular taxpayers | Annually by the 31st of December |
| GSTR-9A | Annual return for composition taxpayers (suspended) | Composition taxpayers | Currently suspended |
| GSTR-9B | Annual return for e-commerce operators (suspended) | E-commerce operators | Currently suspended |
| GSTR-9C | Reconciliation statement along with GSTR-9 | Taxpayers with turnover above a certain threshold | Annually by the 31st of December |
| GSTR-10 | Final return upon cancellation of registration | Taxpayers whose registration is canceled | Within three months of cancellation |
| GSTR-11 | Claim refunds of GST paid on inward supplies | UIN holders (e.g., embassies) | Monthly by the 28th of the following month |
| CMP-08 | Declare summary of outward supplies and tax liability | Composition taxpayers | Quarterly by the 18th of the month following the quarter |
| ITC-04 | Report details of goods sent to or received from a job worker | Manufacturers | Quarterly by the 25th of the month following the quarter |
Active Returns
- GSTR-1: Filed by regular taxpayers to report outward supplies of goods or services. Due monthly by the 11th of the following month or quarterly by the 13th of the month following the quarter.
- GSTR-3B: A summary return to declare outward supplies, input tax credit, and tax liability. Due monthly by the 20th of the following month.
- GSTR-4: An annual return for composition taxpayers summarizing their quarterly CMP-08 statements. Due annually by the 30th of April following the financial year.
- GSTR-5: Filed by non-resident taxable persons to report their business transactions in India. Due monthly by the 20th of the following month or within 7 days after the expiry of registration.
- GSTR-5A: Filed by non-resident OIDAR service providers to report their supplies to non-taxable persons in India. Due monthly by the 20th of the following month.
- GSTR-6: Filed by input service distributors to distribute input tax credit to their branches. Due monthly by the 13th of the following month.
- GSTR-7: Filed by entities deducting TDS to report the tax deducted and paid. Due monthly by the 10th of the following month.
- GSTR-8: Filed by e-commerce operators to report supplies made through their platform and the TCS collected. Due monthly by the 10th of the following month.
- GSTR-9: An annual return summarizing monthly or quarterly returns filed by regular taxpayers. Due annually by the 31st of December following the financial year.
- GSTR-9C: A reconciliation statement filed along with GSTR-9 by taxpayers with a turnover above a certain threshold. Due annually by the 31st of December following the financial year.
Suspended Returns
- GSTR-2: Was used to report inward supplies of goods or services, but is currently suspended. It included details of purchases and input tax credit.
- GSTR-3: Was a monthly return based on the finalization of outward and inward supplies, but is currently suspended. It included details of tax liabilities and payments.
- GSTR-9A: Was an annual return for composition taxpayers, but is currently suspended. It included details of turnover, inward supplies, and tax paid.
- GSTR-9B: Was an annual return for e-commerce operators, but is currently suspended. It included details of supplies made through the platform and TCS collected.
View-Only Returns
- GSTR-2A: An auto-drafted statement of inward supplies based on the suppliers’ GSTR-1. Available for viewing and reconciliation purposes.
- GSTR-2B: An auto-drafted ITC statement providing details of eligible and ineligible input tax credit. Helps taxpayers in claiming accurate ITC.
- GSTR-6A: An auto-drafted statement for input service distributors based on the suppliers’ GSTR-1. Available for viewing and reconciliation purposes.
- GSTR-10: A final return filed by taxpayers whose GST registration has been canceled or surrendered. Due within three months of the date of cancellation or order of cancellation, whichever is later.
- GSTR-11: Filed by UIN holders (e.g., embassies) to claim refunds of GST paid on inward supplies. Due monthly by the 28th of the month following the month in which the inward supplies are received.
Other Important Returns
1- GSTR-1A: Allows taxpayers to amend details of outward supplies reported in GSTR-1 before filing GSTR-3B. Helps in correcting errors and discrepancies.
2- CMP-08: A quarterly statement-cum-challan filed by composition taxpayers to declare their summary of outward supplies and tax liability. Due quarterly by the 18th of the month following the quarter.
3- ITC-04: Filed quarterly by manufacturers to report details of goods sent to or received from a job worker. Due quarterly by the 25th of the month following the quarter.
Penalties and Late Payment Fees on GST Returns Filing
If you miss the return filing deadline, the GST council charges an 18% interest charge on the late payment of taxes under the GST. This interest is payable for the number of days the payment is late from the GST return filing due date.
A GST return filing penalty fee is also applicable. GST return filing late fee for taxpayers is ₹ 50/day. ₹ 25 per day goes to CGST, and ₹ 25 per day goes to SGST (in case of any tax liability).
In the case of Nil tax liability, ₹ 20/day is chargeable. ₹ 10/- the day goes as CGST, and the other Rs 10 as SGST. This penalty is subject to a maximum of ₹ 5000/-.
GST Return Filing Process
The GST return filing process might differ for different GST returns. But the goal is the same: to ensure the correct reporting of financial transactions and compliance with tax regulations.
Here are the major steps in the GST return filing process –
1. Registration
The first step is to register for GST with the appropriate tax authority. Entities liable to register for GST include businesses with a turnover exceeding ₹40 lakhs for goods (₹20 lakhs for special category states) and ₹20 lakhs for services (₹10 lakhs for special category states).
2. Maintaining Records
Registered taxpayers need to maintain proper records of all financial transactions. These include sales, purchases, input tax credits, output tax liability, and other relevant details.
3. Generating Invoices
The next step is for taxpayers to issue invoices for all outward supplies made, as per the prescribed format and rules laid down by GST law. Invoices need to contain specific information such as GSTIN, details of the supplier and recipient, description of goods or services, HSN or SAC codes, and taxes charged.
4. Filing of Returns
Filing of the GST returns is periodic depending on the type of taxpayer and the nature of transactions. The most common types of GST returns include GSTR-1 (for outward supplies), GSTR-3B (monthly summary return), and GSTR-9 (annual return). Other returns such as GSTR-4 (for composition scheme taxpayers), GSTR-9A (for composition scheme taxpayers), and others may also apply based on the taxpayer’s profile.
5. GST Return Filing Online
One can file GST returns electronically through the GST Common Portal (https://www.gst.gov.in/). For GST return filing online, taxpayers need to log in to the portal using their credentials and navigate to the relevant section to file their returns. The return filing portal provides user-friendly interfaces for entering data, validating information, and submitting returns. One can also check their GST return filing status using the GST portal.
6. Payment of Taxes
After filing returns, taxpayers need to pay any taxes due through the GST portal. Options to pay via online mode using various payment modes, such as net banking, credit/debit cards, NEFT/RTGS, and over-the-counter payments.
7. Acknowledgment and Confirmation
Once taxpayer files the returns and pays the due taxes, they receive an acknowledgement in the form of a unique reference number (ARN) or acknowledgement receipt. This confirms the successful filing of returns. They can further check the GST return filing status using the GST portal.
8. Verification and Reconciliation
Taxpayers should verify the details submitted in the returns and reconcile them with their financial records to comply with GST laws.
10. Compliance and Follow-up
Taxpayers should comply with any notices, communications, or requirements from the tax authorities regarding their GST returns. Addressing any discrepancies or issues promptly is essential to avoid penalties or fines.
Challenges and Solutions in GST Return Filing
Filing GST returns is complex, with a need to understand the Indian tax system, technology, and procedures. Here are the major challenges that registered taxpayers face while GST return filing –
Compliance Complexity
When dealing with GST returns, there are many complex compliance requirements, such as multiple returns, diverse tax rates, and various forms for different types of taxpayers.
Technical Issues with GST Portal
Taxpayers often encounter technical glitches, slow processing times, and system downtimes while filing returns on the GST portal.
Data Accuracy and Reconciliation
The biggest challenge for taxpayers and finance teams is the wrong entry of data, which results in the wrong output, whether it’s return filing, tax calculations, or ITC claims.
Input Tax Credit Reconciliation
Reconciling input tax credit (ITC) claims with supplier invoices uploaded can take time and effort, especially if suppliers’ mismatch or are non-compliant.
Compliance Challenges for Small Taxpayers
Small and medium-sized enterprises (SMEs) generally lack the resources and expertise to deal with the complexities of GST compliance, leading to a compliance burden and increased costs.
Legal and Procedural Challenges
Changes in GST laws, rules, and GST return filing procedures can create confusion and uncertainty for taxpayers, leading to compliance challenges.
Conclusion
GST return filing is vast and dealing with it is complicated. While filing returns whether monthly, quarterly or annually, teams have to be extra careful and diligent. Despite these hurdles, there are solutions like integrating smart GST Compliance software to ease the GST return filing procedures.
Get onto your daily tasks of compliance with advanced features of software like GSTrobo which lets you leverage cutting-edge technology. With one-click return filing and reconciliation solutions, it provides real-time invoice matching mechanisms to avoid errors. With automated processes, the software lets the finance teams save time and effort and being a cloud platform, it provides businesses with correct record-keeping to stay vigilant regarding audit trials and any penalties. GSTrobo automatically updates the new amendments within the software to keep businesses compliant.
