A return is a statement of specified details relating to business carried on by an individual/body of persons/company who is liable to be taxed under the concerned laws of the country during a financial year regarding their business activities during a particular period. GST is a self assessed destination based tax system. The submission of returns bridges the gap between the tax payer and the administration.
The following individuals need to file returns under GST:
- Every registered person has to file return within the stipulated period even if there is no business activity during said period.
- Government bodies and companies, public sector undertakings, etc. dealing in GST supplies which are exempted or excluded under Mode GST Law or persons dealing solely in exempted / Nil rated / non –GST goods and/or services are not required to obtain registration or file returns under the Model GST law. However, the respective State tax authorities shall, if it thinks fit, provide Departmental IDs to such government entities and ask the suppliers to mention the particulars of this ID in the supply invoices for all inter-State transactions made. Such supplies will conform to the provisions of B2C supplies and will be governed in the prescribed manner.
- UN agencies will have a unique GST ID and will file return for the month (in a simpler way) they undertake transactions. They will not be required to file regular returns and would provide their purchase statements (without purchase invoices) according to the periodicity given for claim of refund.
A basic periodicity of returns for a class of taxpayers would be prescribed. The period of filing of returns for different categories of tax payers would differ, after payment of tax due, either before or at the time of filing return. The periodicity of return for various classes of taxpayers is as follows:
There are some things we need to know about the filing of GST returns. They are as follows:
- Filing of GST would be made online. Of course the returns can be prepared and generated offline but in that case the returns have to be uploaded.
- There will be a common online return for CGST, SGCT, IGST and additional tax.
- A tax payer has to file returns either by himself or through his authorized representative.
- The tax payer may submit the returns himself or has to avail of the services of Tax Return Preparer (TRP) or Facilitation Centre (FC). TRPs will have to be approved by tax administration and will be given an ID. Information regarding TRP will be shared on GST portal.
- Registration of TRP/FC will be done by the Central Board of Excise and Customs (CBEC) / the respective State tax authorities. The particulars of the registration will be available on GSTN to help applicants/taxpayers to choose one from the given list of registered TRPs/FCs. The law regarding GST may also contain suitable provisions about it.
- A tax payer has to register at the GST portal (www.gst.gov.in). A unique ID and password would be provided to him. Thereafter, during filing of returns, he/she or his/her authorized representative would have to submit that ID and password.
- Tax payer can put his signature on the return through the “One-Time Digital Signature Certificate”. This will get rid of the hassle of printing out the acknowledgement of return.
- No revision of returns would be allowed under this scheme.
- Persons liable to pay tax would have to file annual returns under sub-section (1) of section 30 of the Model GST Law electronically in FORM GSTR 9 through the common portal either directly, or through the FC, as notified by Board or Commissioner.
- In taxpayer fails in the submission of periodic returns, a list of defaulters will be electronically generated (and a notice will be automatically sent via email / SMS) by the system after running a comparison of the return filers and the database of the registrants’ details. Such defaulter list will be provided to the concerned GST Authorities and follow-up action would be taken accordingly.
The steps of filing of the returns can be illustrated by the simple flowchart:
Until recently, filing of returns had been a rather cumbersome process since tax payers had to file separately for an array of indirect taxes such as VAT, excise duty, service tax etc. However, under the Model GST law, this inconvenience had been removed as a common filing of return exists. The GST portal has been recently launched. New registrations under GST will start from April 2017. About 80 lakh tax payers will be shifted from the existing system to GST regime.
Despite being ambitious, the GST model is relatively new and considering India’s current economic system, it still has a number of hurdles till it can successfully achieve the purpose it was framed for. Thus, it remains to be seen how this system can live up to its promises in the future.