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Simplified and New GST Returns from April 2020

Ruchi Gandhi

| Updated: Jan 22, 2020 | Category: GST, GST Returns

new gst returns

­To facilitate filing of returns by registered taxpayers under GST, the GST Council in its 31st meeting, proposed the implementation of a new GST return system from October 2019 onwards. The new GST return filing system has been put into place on a trial basis to familiarize the users, and the same will be legitimately invoked from 1st April 2020. Under the new GST return mechanism, three major components to the GST return are recognized, namely one simplified main return (FORM GST RET-1) and two annexures (FORM GST ANX-1 and FORM GST ANX-2).

Applicability of the new GST Return formats

Large taxpayers having aggregate annual turnover of more than Rs. 5 crore in the preceding financial year have to upload monthly returns. On the other hand, small taxpayers having aggregate annual turnover of up to Rs. 5 crore in the preceding financial year can opt to upload quarterly returns. Hence, FORM GST RET-1 needs to be periodically filed on a monthly basis by all taxpayers unless quarterly filing of returns is explicitly opted for by small taxpayers. Newly registered taxpayers shall be considered as small taxpayers having the option to file quarterly returns.

Small taxpayers, instead of filing FORM GST RET-1, may choose any of the 2 new quarterly returns, namely SAHAJ (FORM GST RET-2) and SUGAM (FORM GST RET-3), as applicable to them. The provisions pertaining to new GST returns are summarized as shown below:

FORM GST RET-1 (Normal Monthly)

FORM GST RET-1 (Normal Quarterly)

FORM GST RET-2 (SAHAJ Quarterly)

FORM GST RET-3 (SUGAM Quarterly)

Taxpayers having aggregate annual turnover of more than Rs. 5 crore in the preceding financial year need to file this return.     

 

Taxpayers having aggregate annual turnover of up to Rs. 5 crore in the preceding financial year may opt to file this return.  

 

Taxpayers having aggregate annual turnover of up to Rs. 5 crore in the preceding financial year; and who supply only to consumers and unregistered dealers (B2C), may opt to file this return.

Taxpayers having aggregate annual turnover of up to Rs. 5 crore in the preceding financial year; and who supply both to consumers and unregistered dealers (B2C) and to registered dealers (B2B), may opt to file this return.

­It has to be filed monthly by 20th of the succeeding month (i.e., succeeding the month in which tax liability arises).

These returns have to be filed quarterly by 20th of the succeeding month (i.e., succeeding the quarter in which tax liability arises).

 

Each such return has to be filed on the basis of FORM GST ANX-1 and FORM GST ANX-2.

 

Tax needs to be paid on a monthly basis with the help of FORM GST PMT-08.

Tax needs to be paid on a monthly basis with the help of FORM GST PMT-08. For the first two months of the quarter, tax payment shall be declared using a payment declaration form.

 

Taxpayers opting for GST RET-1 (Monthly) can declare all types of outward supplies, inward supplies, credit availed, tax or interest payment, etc.  

Taxpayers opting for GST RET-1 (Quarterly) can declare all types of outward supplies, inward supplies, credit availed, tax or interest payment, etc.

Taxpayers opting for SAHAJ Quarterly return can declare the following:

• Outward B2C supplies

• Inward supplies attracting reverse charge

 

Taxpayers opting for SUGAM Quarterly return can declare the following:

• Outward B2C and B2B supplies

• Inward supplies attracting reverse charge

Sales via e-commerce platforms may be covered here.

Sales via e-commerce platforms may be covered here.

E-commerce dealers cannot file this return.

E-commerce dealers cannot file this return.

Note: The nature of supplies in case of FORM GST RET-1 (Monthly and Quarterly) may be supplies to consumers or unregistered persons (B2C), supplies to registered persons (B2B), export supplies, supplies to SEZ, deemed export, etc.

The present FORM GSTR-1 shall be replaced by the new FORM GST ANX-1. Both large and small taxpayers can upload their invoices on a continuous basis through FORM GST ANX-1. The annexures to new GST returns[1] (which are linked to the main return) comprise the following:

FORM GST ANX-1 (Annexure of Supplies)

FORM GST ANX-2 (Annexure of Inward Supplies)

The following information is to be declared in this form:

  • Outward supplies
  • Inward supplies attracting reverse charge
  • Details of import of goods and services

The following information is to be declared in this form:

  • All inward supplies

These details need to be declared invoice-wise (other than B2C supplies) on a real-time basis.

The recipient can function on auto-populated documents available on a real-time basis, which are uploaded by the supplier.


Features of the new GST return SAHAJ and SUGAM

Some of the peculiarities of the new GST return system are as follows:

  • An option is given to small taxpayers to file their GST returns on a quarterly basis.
  • Taxpayers have an alternative to file NIL return through SMS facility.
  • Taxpayers are made accessible to a mechanism whereby revenue invoices can be continuously uploaded on a real-time basis.
  • Input tax credit can be inferred and evidently claimed by the recipient based on invoices uploaded by the corresponding supplier. This shall lead to genuine claims of ITC.
  • The invoice details can be uploaded by the supplier in his FORM GST ANX-1, and the same will be auto-populated in the recipient’s FORM GST ANX-2, thus, enabling it to be viewed by the recipient on a real-time basis. On auto-population in FORM GST ANX-2, the recipient can take action on a continuous basis, to accept, reject or to keep pending such inward supply details after 10th of the following month when it was uploaded by the supplier. The documents once accepted, shall not be amendable at the corresponding supplier’s end.
  • An amendment return can be filed to account for missing invoices and amendments, if any.
  • Where a taxpayer has applied for cancellation of GST registration, his registration shall be suspended and returns will not need to be filed for such period. However, this was not the case under the old return filing system, which necessitated filing of GST returns till the time cancellation was effective, despite the submission of application for cancellation.
  • As opposed to current system, the new GST return filing system allows for provisional claim of ITC. Where a supplier fails to upload his invoices or file return, the recipient shall be allowable to claim ITC on a provisional basis, not exceeding 20% of the value mentioned.

Conclusion

To keep transparency intact and knock off any scope for tax evasion under the indirect taxes regime, the GST Council has promulgated the launch of new GST return filing system. Such system is easier for the taxpayers as well as fairer for the revenue department.

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Ruchi Gandhi

A CA together with MBA (Fin) and M Com, she relishes taking interest in insightful writing in the domain of taxation and finance. She has gained experience as a full-time author and has also served an accounting role in industry.

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