GST Compliance and Filing

GST Compliance and Filing

The introduction of the Goods and Services Tax (GST) has brought significant tax reforms, unifying various state and central taxes into a single taxation system.

GST compliance refers to the set of rules and regulations under the GST framework that businesses must follow.

  • Ensures that businesses meet their legal obligations under GST.
  • Tax authorities oversee the collection, payment, and reporting of taxes as per GST requirements.
  • GST registration is mandatory for all businesses under the GST Act.

Overview of GST Compliance and Filing

The Indian government introduced the Goods and Services Tax (GST) on July 1, 2017, as a unified tax system that applies to all business activities in India. GST is a nationwide tax imposed on both goods and services, and is levied only on the “value added” at each stage of the economic supply chain.

This new GST regime comes with compliance guidelines that businesses must adhere to. These rules are updated periodically based on government requirements.

The GST tax system has been a crucial reform, bringing transparency and simplifying administrative processes. Since its introduction, it has been particularly beneficial for startups, small, and medium-sized enterprises, as technology now allows for easier GST registration and filing of returns online.

Essential GST Compliances

1. GST Registration Compliance

  • Timely Registration: Businesses must register within the prescribed time to avoid penalties.
  • Accurate Information: Ensure complete and accurate details to avoid rejection or fines.
  • Proper Invoicing: Issue GST-compliant invoices with required details.
  • Filing GST Returns: Regular returns must be filed on time, detailing sales, purchases, and tax liability.
  • Payment of GST: Timely payment of GST to avoid penalties.
  • Record Maintenance: Maintain all relevant records for transparency and audits.
  • GST Audits: Cooperate with audits and provide necessary documents.
  • E-Invoicing: Follow e-invoicing guidelines if applicable.

2. GST Return Compliance

  • Timely Filing: File returns within due dates to avoid penalties.
  • Accurate Reporting: Ensure correct details of sales, purchases, and tax liability.
  • Input Tax Credit Reconciliation: Match input credits with supplier returns.
  • Amendments: Correct errors and omissions in returns.
  • Payment: Ensure timely payment of GST dues.
  • Reconciliation: Reconcile GSTR-2A with purchase records.

3. GST Exemptions

  • Basic Necessities: Exemptions for essential goods and services like food, healthcare, and education.
  • Financial Services: Certain financial services, like loans and insurance, are exempt.
  • Export: Exports are zero-rated, not subject to GST.
  • Government Services: Services provided by the government are exempt.
  • Charitable Activities: Non-profit organizations are exempt for social welfare activities.
  • Small Businesses: Some small businesses enjoy simplified tax regimes.

GST Filing: A Brief Overview

GST (Goods and Services Tax) is a single tax on the supply of goods and services, and businesses are required to file GST returns periodically. GST returns are documents filed by taxpayers to report their income, output tax, and other relevant details to the government.

GST Return is a document filed with the government summarizing the sales, purchases, tax liabilities, and input tax credits for a specific period.

Types Of GST Returns

There are various GST returns that businesses may need to file, depending on their nature of business, turnover, and specific tax obligations.

GST Returns for Regular Businesses:

1. GSTR-1:

  • Filed by businesses to report outward supplies (sales) of goods and services.
  • Due date: 11th of each month (for monthly filers) and 13th (for quarterly filers under the QRMP scheme).

2. GSTR-3B:

  • A summary return filed by businesses to report GST liabilities and input tax credits (ITC).
  • Due date: 20th of every month for monthly filers and 22nd for quarterly filers.

3. GSTR-9:

  • Annual return for regular taxpayers.
  • Filed once every year (for businesses with turnover above 2 Crore).

4. GSTR-8:

  • Filed by e-commerce operators to report tax collected on sales made through the platform.

GST Returns for Composition Scheme:

1. GSTR-4:

  • Filed by taxpayers under the Composition Scheme to report turnover and tax liabilities.

2. GSTR-9A:

  • Annual return for businesses under the Composition Scheme.

GST Returns for Non-Residents:

1. GSTR-5:

  • Filed by non-resident foreign taxable persons (who supply goods or services in India).

2. GSTR-6:

  • Filed by input service distributors to report their input tax credits.

3. GSTR-7:

  • Filed by persons required to deduct TDS (tax deducted at source).

GST Returns for Input Service Distributors:

1. GSTR-6:

  • Filed by input service distributors (ISD) to report the distribution of input tax credit.

GST FILING PROCESS

  1. Collect GST Data: Gather all necessary documents and records of sales, purchases, input tax credit, and output tax.
  2. Login to GST Portal: Access the GST portal using your GSTIN and credentials.
  3. Fill GST Return Forms: Complete the appropriate GST return form based on the type of business and turnover.
  4. Submit & File: Verify the information, submit the return, and make any payments (if applicable).
  5. Reconciliation: After filing, reconcile GST returns with the actual transactions to avoid errors.

How TaxMyles Helps You with GST Compliance

The introduction of GST has added more regulatory requirements for businesses. It’s crucial for every business to consult with TaxMyles tax professionals to understand the specific compliance obligations applicable to their operations. If you have any questions or need guidance on GST or other tax matters, reach out to us. Our team of taxation experts will provide you with the best professional support to ensure your business stays fully compliant.