Annual GST Compliances

Annual GST Compliances

The trades operating on goods and services, such as, transport, hospitality, food manufacturing/processing, business of tools and equipments, etc. with minimum threshold turnover of INR 40 lakh (for goods) and INR 20 lakh (for services) should compulsorily get themselves registered in GST. This is a single device to collect Indirect Tax as introduced by Government of India under Central Board of Indirect Tax (CBIT) that is applicable at each stage of supply chain. Note that, there are exemptions and relaxation available to trades and specific regions (for NE States, the minimum GST threshold is INR 20 lakh) depending on the trading nature and business capital utilised. Once, the eligible GST taxpayers are registered with GST, they are liable to fulfil certain GST compliances per FY, otherwise can face legal charges. So, let us know about the major GST compliances applicable Goods and Services Business of India in general.

Note: There are separate GST rules applicable to the Goods and Services Trades depending on their nature/size/operation/zone, etc. and so, GST compliances vary from such businesses.

Compliances of GST After Registration

A GST Registered trader has a number of introductory compliance to be unfailingly performed and be followed afterwards, until the trade terminates the GST registration. Here, we’re giving you these beginning stages in brief way:

While completing his/her allotted GST duties, the concerned trader should make sure of the following things:

• In case, a trader is making IntraState supply, he/she comes under CGST and SGST liabilities. Else, for InterState supply, IGST should be applicable.
• GST Invoice should be issued for every taxable supplies. Composition dealer should issue bill of supply/exempt supply. A single invoice-cum-bill should be issued for supply of taxable/exempted items to an unregistered person.
• For supply of goods, GST Tax Invoice should be issued during the time of removal of goods. In case of any service, GST Tax Invoice should be issued within 30 days from the service is provided.
• A trader should mention the applicable GST on the item(s) sold in the GST invoice otherwise can be charged with penalties. Every supplier, except for them for whom Reverse Charge under GST is applicable, should issue such invoices to the buyers and deposit the requisite GST Tax in Government’s Account within due date.
• Input Tax Credit (ITC) is claimed based on the GST charged over the purchase of goods/services in the form of CGST and SGST/IGST with applicable rate.
• Composition Dealers are exempted from charging any kind of GSTs from buyers and are not eligible to claim ITC.
• As per the GST law, the registered trader should compulsorily keep accounts/records updated as per the prescribed guidelines, such as, record of at least 72 months per FY from annual return filing due date in GSTR-9/GSTR-9A. Following are the records required to maintain as part of GST liability:
  • Production of Goods
  • Outward and Inward Supply of Goods/Services
  • Stock Register
  • ITC availed

Output tax payable and paid

Annual GST Compliances per FY

Once, a trader is registered with GST (Goods and Services Tax), he/she should be fulfilling mandatory GST compliances every FY, such as:

• Furnish periodic GST Return with details of outward sales of goods/services, details of ITC, invoices, debit/credit notes, etc. It is followed by a Summary Return for the purpose of ensuring the authenticity.

Notes: Traders should be uploading all the necessary invoices along with their filing. GST provides online provision of review and make amendments in these invoices as done by suppliers and purchasers (based on inward/outward supply).

Depending on the type of GST registered trader, the filing time differs, such as:

• Normal GST Traders: monthly (both Return/Summary)
• Composite Dealers (with annual turnover up to INR 1.5 crore): quarterly
• Ecommerce Operators (they are liable to collect TCS): monthly
• Input Service Distributors: monthly
• Non-Resident Foreign Dealers: monthly

Etc....

• Maintain Accounts and Records strictly following the GST Rules, such as, Purchase Register, Sales Register, Stock Register, Record of Input Tax Credit, Output Tax Liability
• Perform GST specific Accounts Audits to be done by a Registered practicing Chartered Accountant to provide Audited Financial Statements to be furnished to the GST Office per FY (Mandatory for the traders of Goods/Services whose annual turnover has crossed INR 2 crore in a FY)
• Claim Input Tax Credit to be done by every GST registered, except the Composite Dealers
• Furnish Annual Return per FY valid for every GST registered taxpayer

Benefits of Annual GST Compliances for Eligible Businesses

• GST is a single Indirect Tax option that relieves a taxpayer from many State and Central Level Indirect taxes present previously and thus its process is much simplified.
• Much simple and beneficial GST choices are available for small traders, such as:
  1. Composite GST
  2. Voluntary GST
• GST threshold for registration of normal taxpayer is higher and so it excludes small traders and gives them relief of GST compliances
• GST Registration and Filing are online process that can be updated, reviewed and rectified anywhere, anytime.
• Number of GST compliances is lesser as it has now removed various previously valid State and Central level indirect taxes with separate compliances
• Unorganized Sector is regulated under GST and it includes e-commerce operators

Annual GST Returns to File by Eligible Businesses

There are event based GST filings done under special circumstances to the GST Department, such as:

• GSTR-10 : Return filing for those taxpayers whose GST Registration is cancelled
• GSTR-11 : GST taxpayers issued with Unique Identity Number (UIN) to receive refunds under GST for the goods and services purchased in India.
• GST REG 16 : Cancellation of GST Registration, except taxpayers with UIN, those who are registered as Tax deductors/Tax collectors