In the GST Regime, businesses whose turnover exceeds Rs. 20 lakhs (Rs 10 lakhs for NE and hill states) is required to register as a normal taxable person. This process of registration is called GST registration.
For certain businesses, registration under GST is mandatory. If the organization carries on business without registering under GST, it will be an offence under GST and heavy penalties will apply.
GST registration usually takes between 2-6 working days.
An offender not paying tax or making short payments (genuine errors) has to pay a penalty of 10% of the tax amount due subject to a minimum of Rs.10,000.
The penalty will at 100% of the tax amount due when the offender has deliberately evaded paying taxes
GST has been implemented in India from 1st July, 2017. Under the new GST regime, nearly 1 crore busineses in India have obtained GST registration. All entities having GST registration are required to file GST returns, as per the GST return due date schedule mentioned below. GST return filing is mandatory for all entities having GST registration, irrespective of business activity or sales or profitability during the return filing period. Hence, even a dormant business that obtained GST registration must file GST return.
GST registration holder are required to file GSTR-1 (details of outward supplies) on the 10th of each month, GSTR-2 (details of inward supplies) on the 15th of each month and GSTR-3 (monthly return) on the 25th of each month. Dealers registered under the GST composition scheme are required to file GSTR-4 every quarter, on 18th of the month next to the quarter. Finally, annual GST return must be filed by all GST registered entities on/before the 31st of December.
Audit under GST is the process of examination of records, returns and other documents maintained by a taxable person. The purpose is to verify the correctness of turnover declared, taxes paid, refund claimed and input tax credit availed, and to assess the compliance with the provisions of GST.
Every registered taxable person whose turnover during a financial year exceeds the prescribed limit [as per the latest GST Rules, the turnover limit is above Rs 2 crore] shall get his accounts audited by a chartered accountant or a cost accountant. He shall electronically file:
1. An annual return using the Form GSTR 9 by 31st December of the next Financial Year*,
2. The audited copy of the annual accounts,
3. A certified reconciliation statement in the form GSTR-9C, reconciling the value of supplies declared in the return with the audited annual financial statement
An annual return has to be filed once in a year by the registered taxpayers under GST including those registered under composition levy scheme under GSTR-9 & GSTR-9A.
What is GSTR-9 annual return?
GSTR 9 form is an annual return to be filed once in a year by the registered taxpayers under GST. It consists of details regarding the supplies made and received during the year under different tax heads i.e. CGST, SGST and IGST. It consolidates the information furnished in the monthly or quarterly returns during the year.
Who should file GSTR 9 annual return?
All the registered taxable persons under GST must file GSTR 9 form. However, the following persons are not required to file GSTR 9
1. Taxpayers opting Composition scheme as they must file GSTR-9A
2. Casual Taxable Person
3. Input service distributors
4. Non-resident taxable persons
5. Persons paying TDS under section 51 of GST Act.
What are different types of annual returns?
There are 4 types of annual returns :
1. GSTR 9: GSTR 9 should be filed by the regular taxpayersfiling GSTR 1, and GSTR 3B.
2. GSTR 9A: GSTR 9A should be filed by the persons registered under composition scheme under GST.
3. GSTR 9B: GSTR 9B should be filed by the e-commerce operators who have filed GSTR 8 during the financial year.
4. GSTR 9C: GSTR 9C should be filed by the taxpayers whose annual turnover exceeds Rs 2 crores during the financial year. All such taxpayers are also required to get their accounts audited and file a copy of audited annual accounts and reconciliation statement of tax already paid and tax payable as per audited accounts along with GSTR 9C.
What is the due date of GSTR-9?
GSTR-9 due date is on or before 31st December of the subsequent financial year. For instance, for FY 2017-18, the due date for filing GSTR 9 is 31st December 2018
What is the Penalty for the late filing of GSTR-9 form?
Late fees for not filing the GSTR 9 within the due date is Rs. 100 per day per act up to a maximum of an amount calculated at a quarter percent of the taxpayer turnover in the state or union territory. Thus it is Rs 100 under CGST & 100 under SGST, the total penalty is Rs 200 per day of default. There is no late fee on IGST
Who can update GST registration details?
A business can update or correct its GST registration details when:
The application is being processed and
The business is already registered under GST (application is already processed)
What are details that can be changed or updated?
A business owner can apply for change(s) of the following items:
1. Name of business.
2. Address of the principal place of business.
3. An additional place of business.
4. Addition, deletion or retirement of partners or directors, Managing Committee, CEO i.e., people who are responsible for day to day affairs of the business.
5. Mobile number or e-mail address of the authorized signatory.
6.Revocation of Cancellation
Time Limit for Revocation
Any registered taxable person can apply for revocation of cancellation of GST registration within a period of 30 days from the date of service of order of cancellation of GST registration. It must be noted that the application for revocation can be done only during the circumstances when the registration has been cancelled by the proper officer on his own motion. Hence, revocation cannot be used when GST registration was cancelled voluntarily by a taxpayer.
Application for Revocation
Application in FORM GST REG-21 needs to be filed by the registered person, for revocation of GST registration, either directly or through a facilitation centre notified by the Commissioner
Processing of Application
When the proper officer is satisfied that the reason being provided for revocation of cancellation of registration is appropriate, then, the officer will revoke the cancellation of registration.
The time period of revocation, by the proper officer, is 30 days from the date of application. The proper officer is required to pass an order revoking the cancellation of registration in FORM GST REG-22.
Rejection of Application
If a GST officer is not satisfied with the revocation application, the officer would issue a notice in FORM GST REG-23. On receipt of the notice, the applicant is required to furnish a suitable reply in FORM GST REG-24 within a period of 7 working days from the date of service of the notice. On receipt of a suitable reply from the applicant, the officer is required to pass a suitable order in FORM GST REG-05 within a period of 30 days from the date of receipt of a reply from the applicant.
7.GST E-way Bill Registration & Generation
What is an eWay Bill?
EWay Bill is an Electronic Way bill for movement of goods to be generated on the eWay Bill Portal. A GST registered person cannot transport goods in a vehicle whose value exceeds Rs. 50,000 (Single Invoice/bill/delivery challan) without an e-way bill that is generated on ewaybillgst.gov.in Alternatively, Eway bill can also be generated or cancelled through SMS, Android App and by site-to-site integration through API. When an eway bill is generated, a unique Eway Bill Number (EBN) is allocated and is available to the supplier, recipient, and the transporter.
When Should eWay Bill be issued?
eWay bill will be generated when there is a movement of goods in a vehicle/ conveyance of value more than Rs. 50,000( either each Invoice or in (aggregate of all Invoices in a vehicle/ Conveyance)# ) -
In relation to a 'supply'
For reasons other than a 'supply' ( say a return)
Due to inward 'supply' from an unregistered person
For this purpose, a supply may be either of the following:
A supply made for a consideration (payment) in the course of business
A supply made for a consideration (payment) which may not be in the course of business
A supply without consideration (without payment)In simpler terms, the term 'supply' usually means a:
1. Sale - sale of goods and payment made
2. Transfer - branch transfers for instance
3. Barter/Exchange - where the payment is by goods instead of in money
Therefore, eWay Bills must be generated on the common portal for all these types of movements. For certain specified Goods, the eway bill needs to be generated mandatorily even if the Value of the consignment of Goods is less than Rs. 50,000:
1. Inter-State movement of Goods by the Principal to the Job-worker by Principal/ registered Job-worker,
2. Inter-State Transport of Handicraft goods by a dealer exempted from GST registration
Who should Generate an eWay Bill?
Registered Person - Eway bill must be generated when there is a movement of goods of more than Rs 50,000 in value to or from a Registered Person. A Registered person or the transporter may choose to generate and carry eway bill even if the value of goods is less than Rs 50,000.
Unregistered Persons - Unregistered persons are also required to generate e-Way Bill. However, where a supply is made by an unregistered person to a registered person, the receiver will have to ensure all the compliances are met as if they were the supplier.
Transporter - Transporters carrying goods by road, air, rail, etc. also need to generate e-Way Bill if the supplier has not generated an e-Way Bill.
Cases when eWay bill is Not Required
In the following cases it is not necessary to generate e-Way Bil:
1. The mode of transport is non-motor vehicle 2. Goods transported from Customs port, airport, air cargo complex or land customs station to Inland Container Depot (ICD) or Container Freight Station (CFS) for clearance by Customs. 3. Goods transported under Customs supervision or under customs seal 4. Goods transported under Customs Bond from ICD to Customs port or from one custom station to another. 5. Transit cargo transported to or from Nepal or Bhutan 6. Movement of goods caused by defence formation under Ministry of defence as a consignor or consignee 7. Empty Cargo containers are being transported 8. Consignor transporting goods to or from between place of business and a weighbridge for weighment at a distance of 20 kms, accompanied by a Delivery challan. 9. Goods being transported by rail where the Consignor of goods is the Central Government, State Governments or a local authority. 10. Goods specifed as exempt from E-Way bill requirements in the respective State/Union territory GST Rules. 11. Transport of certain specified goods- Includes the list of exempt supply of goods, Annexure to Rule 138(14), goods treated as no supply as per Schedule III, Certain schedule to Central tax Rate notifications.
What is meant by cancellation of registration?
Cancellation of GST registration simply means that the taxpayer will not be a GST registered person any more. He will not have to pay or collect GST.
Consequences of Cancellation
The taxpayer will not pay GST anymore. For certain businesses, registration under GST is mandatory. If the GST registration is cancelled and business is still continued, it will mean an offence under GST and heavy penalties will apply.
Forms for cancellation
All those who cannot follow the above method must file an application for cancellation in FORM GST REG 16. The legal heirs of the deceased taxpayer will follow the same procedure as below.
Application for cancellation has to be made in FORM GST REG 16.
The following details must be included in FORM GST REG 16 -
1. Details of inputs, semi-finished, finished goods held in stock on the date on which cancellation of registration is applied 2. Liability thereon 3. Details of the payment
The proper officer has to issue an order for cancellation in FORM GST REG-19 within 30 days from date of application. The cancellation will be effective from a date determined by the officer and he will notify the taxable person.
Cancellation by tax officer
Why will the officer cancel registration?
The registration can be cancelled, if the taxpayer-
(a) Does not conduct any business from the declared place of business OR
(b) Issues invoice or bill without supply of goods/services (i.e., in violation of the provisions) OR
(c) Violates the anti-profiteering provisions (for example, not passing on benefit of ITC to customers)
9.Letter of Undertaking (LUT)
All registered tax payers who export the goods or services will now have to furnish Letter of Undertaking (LUT) in GST RFD-11 form on the common portal of GSTN in order to make exports without payment of IGST.
When to apply/file?- Letter of undertaking has to be filed /submitted online before exporting the goods/services.
Prior to this, exporters had to manually submit the filled and signed RFD-11 on Business letterhead in duplicate –
One to the Jurisdictional Deputy/Assistant Commissioner having jurisdiction over their principal place of business where the verification with the Export documents happens through ICEGATE medium
Another along with the Export documents to the Customs clearing authority.
Just like the earlier excise regime, this led to exporters losing considerable time and operating expense on this compliance.
Eventually, this process has now been rationalised and made simple & quick, giving transparency in the entire process of exports by an exporter to all the stakeholders involved.
Note that the Furnishing of Bond has to be on a non-judicial stamp paper and so needs a manual submission.
10.GSTR 2a reconciliation
GST reconciliation primarily involves matching the data uploaded by the suppliers with those of the recipient's purchase data. This basically includes comparing the GSTR -2A auto-populated from suppliers data and the purchase data recorded by the receiver of the supplies. This matching concept also ensures that all the transactions which took place in a particular period have been recorded.
Why is it important to reconcile under GST?
It is very important to reconcile GST returns data because :
a. Under new GST returns, the taxpayers will only be able to claim ITC if the particular invoice is present in the GSTR 2A or supplier's data. This requirement forces the businesses to reconcile and claim ITC correctly.
b. Sometimes, it happens that vendor has declared his GST liability and credit has not been availed by the purchaser in his GST returns. So, not to lose the claim of ITC, the data should be reconciled on a regular basis. This reconciliation process will ensure no ITC loss on any invoices.
c. To avoid any duplication, taxpayers must consolidate and reconcile the values. This will ensure correct declaration and maximize the credit of input taxes.