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Online GST Return Filing

Online GST Return Filing

Every regular business has to file GST return on all the purchases made, sales, output GST on sales and Input Tax credit on purchases.  The return is used by tax authorities to compute the tax liability of the business.  GSTR-1 is the return detailing the outward supply of taxable goods.  The system has been designed in such a way that GSTR-3B, which is another return containing summary of outward supplies and input tax credit gets auto-populated on the basis of the entries in GSTR-1.  For the past two years, Xiologics has been helping companies and vendors file their online returns in a time bound and error-free manner

Benefits of GST Return Filing

The first and foremost benefit of GST return is that it eliminates tax liability at multiple points.  All taxes such as Excise Duty, VAT and Octroi imposed by State Governments and Service Tax have been assimilated into one GST.  By filing returns, businesses can take advantage of ‘Input Tax credit’ which is the tax already paid by the supplier.  Under earlier tax regimes, traders with a turnover of more than 5 lakhs were liable to pay tax.  Under GST, small traders with turnover up to 20 lakhs have been exempted.  Traders with turnover up to 75 lakhs can opt for composition scheme and pay just 1% tax on turnover. Such traders however cannot claim input tax credit.

Understanding GST returns in detail

  • GSTR-1: GSTR-1 is a monthly return showcasing the sales transactions or outward supplies of a business.  GSTR-1 is required to be filed by every normal taxpayer, registered under GST.
  • GSTR-2A: This is a read-only document and gets auto-populated once the supplier fills GSTR-1 data.  GSTR-2A, enables the recipient to verify the details uploaded by the supplier.  As you could see, most  GST forms are interlinked to ensure error-free and hassle free return filing.
  • GSTR-2: As opposed to GSTR-1, GSTR-2 is the return of inward supply of goods and services as specified by the recipient.  In short, GSTR-2 lists the purchases made by a business.  GSTR-2 is auto-populated based on GSTR-2A.
  • GSTR-3B: GSTR 3B is the summary of inward and outward supplies. It is a self declaration form showcasing the GST liabilities of the taxpayer.  This form does not require comparison between supplier and purchaser invoices as both of them are required to file GSTR-3B separately.  This also enables timely filing of returns.
  • GSTR-4: Composition scheme has been introduced for the benefit of small traders with an annual turnover of up to 1.5 crore.  Under this scheme traders can opt for a fixed tax rate (1% at present).  On the flip side, such traders cannot claim input tax credit.
  • GSTR-5: Persons not owning a fixed place of business or residence in India, who supplies goods or service in India are required to file GSTR-5.  Unlike normal taxpayers, non-resident taxable persons are required to file monthly returns, but need not file annual return.

Who is an Input Service Distributor and what is meant by Input Tax Credit?

Input Service Distributor can be understood better by the following example:  A chain of stores with Headquarters at Mumbai has branches across the country.  The company provides unified software to be used across branches.  When the entity is a single unit, the input tax credit (GST paid by the software vendor) is claimed by the entity.  However, in case of multiple branches, each branch has to be given the benefit of input tax credit.  The chain of stores at Mumbai (Input Service Distributor in this case) decides to ‘distribute the input service’ across branches to claim their own input tax credit.

  • GSTR-6A: GSTR-6A is an auto-populated form based on the data provided by the suppliers to Input Service Distributor in their own Form GSTR-1. Since GSTR-6A is read-only, any changes to it can be made only by selecting the appropriate option in GSTR-6 forms.
  • GSTR-6: GSTR-6 is a monthly return containing the details of Input Tax Credit received by an Input service distributor. It also contains the documents for distribution of such input tax credit and the manner of distribution. Every Input Service Distributor has to file GSTR-6, even if it is a ‘Nil’ return.
  • GSTR-7: Government entities such as Central and State Government, local bodies and government departments are liable to deduct TDS at source on the supplies received by them. TDS at source is meant to track transaction of supply of goods and services.
  • GSTR-7A: Based on the details furnished by the Deductor on GSTR-7 on the common portal, GSTR-7A is auto-generated. The deductee can avail the TDS certificate electronically, if there is no dispute in the details provided.
  • GSTR-8: GSTR 8 is intended for E-Commerce operators who deduct the tax collected at source under GST. This monthly return reflects the details of supplies made and the amount of tax collected from the suppliers
  • GSTR-9: Every normal registered tax payer has to file an Annual Return in addition to their monthly returns. Filing of annual returns is exempted for Input Service Distributor, Casual Taxable person and non-resident taxable person. Persons registered under GST with no transactions during the year are still required to file a ‘Nil’ return.
  • GSTR-9A: GSTR 9A is the annual return to be filed by composition dealers. As composition dealers are required to file quarterly returns during the year, GSTR 9A is the summary of such quarterly returns with regard to inward and outward supplies tax paid and refund, input credit availed or reversed etc.
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