Q 1. What is the purpose of returns?
Ans.
a) Mode for transfer of information to tax administration;
b) Compliance verification program of tax administration;
c) Finalization of the tax liabilities of the taxpayer within
stipulated period of limitation; to declare tax liability for a given period;
d) Providing necessary inputs for taking policy decision;
e) Management of audit and anti-evasion programs of tax
administration.
Q 2. Who needs to file Return in GST regime?
Ans. Every registered taxable person who crosses the threshold
limit for payment of taxes. A supplier needs to be registered when the
aggregate turnover crosses Rs. Nine lacs but he become taxable person ONLY when
he crosses Rs. Ten lacs. So he will be required to file returns when he crosses
the threshold limit of Rs. ten lacs. There are some other class of persons who
need to be registered and therefore will have to file returns like interstate
suppliers, TDS deductors, e-commerce operators, suppliers supplying goods
through e-commerce operators etc (reference Schedule-III and Question 6 of the
Registration Chapter).
Q 3. What type of outward supply details are to be filed in
the return?
Ans. A normal registered taxpayer has to file the outward supply
details in GSTR-1 in relation to various types of supplies made in a month,
namely outward supplies to registered persons, outward supplies to unregistered
persons (consumers), details of Credit/Debit Notes, zero rated, exempted and
non-GST supplies, exports, and advances received in relation to future supply.
Q 4. Is the scanned copy of invoices to be uploaded along
with GSTR-1?
Ans. No, scanned copy of invoices is to be uploaded. Only certain
prescribed fields of information from invoices need to be uploaded.
Q 5. Whether all invoices will have to be uploaded?
Ans. No. It depends on whether B2B or B2C plus whether Intra-state
or Inter-state supplies. For B2B supplies, all invoices, whether Intra-state or
Interstate supplies, will have to be uploaded. Why So? Because ITC will be
taken by the recipients, invoice matching is required to be done. In B2C
supplies, uploading in general may not be required as the buyer will not be taking
ITC. However still in order to implement the destination based principle,
invoices of value more than Rs.2.5 lacs in inter-state B2B supplies will have
to be uploaded. For intra-state invoices below Rs. 2.5 lacs and all intra-state
invoices, state wise summary will be sufficient.
Q 6. Whether description of each item in the invoice will
have to be uploaded?
Ans. No. In fact description will not have to be uploaded. Only
HSN code in respect of supply of goods and Accounting code in respect of supply
of services will have to be fed. The minimum number of digits that the filer
will have to upload would depend on his turnover in the last year.
Q 7. Whether value for each transaction will have to be fed?
What if no consideration?
Ans. Yes. Not only value but taxable value will also have to
be fed. In some cases both may be different. In case there is no consideration,
but it is supply by virtue of schedule 1, the taxable value will have to be uploaded.
Q 8. Can a recipient feed information in his GSTR-2 which
has been missed by the supplier?
Ans. Yes, the recipient can himself feed the invoices not uploaded
by his supplier. The credit on such invoices will also be given provisionally
but will be subject to matching. On matching, if the invoice is not uploaded by
the supplier, both of them will be intimated. If the mismatch is rectified, provisional
credit will be confirmed. But if mismatch continues even after intimation, the
credit provisionally allowed will be reversed.
Q 9. Do the taxable person have to feed anything in the
GSTR-2 or everything is auto-populated from GSTR-1?
Ans. While a large part of GSTR-2 will be auto-populated, there
are some details that only recipient can fill like details of imports, details
of purchases from non-registered or composition suppliers and
exempt/non-GST/nil GST supplies etc.
Q 10. What if the invoices do not match? Whether ITC given
or denied? If denied, what action is taken against supplier?
Ans. If invoices in GSTR-2 do not match with invoices in
counter-party GSTR-1, the ITC will be reversed if the mismatch continues even
after it is made known to both and still it is not rectified. Mismatch can be
because of two reasons. First, it could be due to mistake at the side of the recipient,
and in such a case, no further action is required. Secondly, it could be possible
that the said invoice was issued by supplier but he did not upload it and pay
tax on it. In such a case, recovery action shall be taken against the supplier.
In short, all mismatches will lead to proceedings if the supplier has made a
supply but not paid tax on it.
Q 11. What will be the legal position in regard to the reversed
input tax credit if the supplier later realizes the mistake and feeds the
information?
Ans. At any stage, but before September of the next financial
year, supplier can upload the invoice and pay duty and interest on such missing
invoices in his GSTR-3 of the month in which he uploaded the invoice. The
recipient will then automatically get ITC on that invoice. The interest paid by
the recipient at the time of reversal will also be returned to the recipient
through an automated system on the GSTN.
Q 12. What is the special feature of GSTR-2?
Ans. The special feature of GSTR-2 is that the details of supplies
received by a recipient can be auto populated on the basis of the details
furnished by the counterparty supplier in his GSTR-1.
Q 13. Whether the ITC denied can be restored?
Ans. If the supplier uploads the invoice at any time after the
reversal but by September of the next financial year, the credit reversed
earlier gets restored along with refund of the interest paid during reversal.
Q 14. Do tax payers under the composition scheme also need
to file GSTR-1 and GSTR-2?
Ans. No. Composition tax payers do not need to file any statement
of outward or inward supplies. They have to file a quarterly return in Form
GSTR-4 by the 1st of the month after the end of the quarter. Since they are not
eligible for any input tax credit, there is no relevance of GSTR-2 for them and
since they do not pass on any credit to their recipients, there is no relevance
of GSTR-1 for them. In their return, they have to declare summary details of
their outward supplies along with the details of tax payment. They also have to
give details of their purchases in their quarterly return itself, most of which
will be auto populated.
Q 15. Do Input Service Distributors (ISDs) need to file
separate statement of outward and inward supplies with their return?
Ans. No, the ISDs need to file only a return in GSTR-6 and the
return has the details of credit received by them from the service provider and
the credit distributed by them to the subsidiaries. Since their return itself
covers these aspects, there is no requirement to file separate statement of
inward and outward supplies.
Q 16. How does a taxpayer get the credit of the tax deducted
at source on his behalf? Does he need to produce TDS certificate from the
deductee to get the credit?
Ans. Under GST, the deductor will be submitting the deductee
wise details of all the deductions made by him in his return in Form GSTR-7 to
be filed by 10th of the month next to the month in which deductions were made. The
details of the deductions as uploaded by the deductor shall be auto populated
in the GSTR-2 of the deductee.
The taxpayer shall be required to confirm these details in
his GSTR-2 to avail the credit for deductions made on his behalf. To avail this
credit he does not require to produce any certificate in physical or electronic
form. The certificate will only be for record keeping of the tax payer and can
be downloaded from the Common Portal.
Q 17. Who all need to file Annual Return?
Ans. All taxpayers filing return in GSTR-1 to 3 other than casual
taxpayers and taxpayers under composition scheme are required to file an annual
return. Casual taxpayers, nonresident taxpayers, ISDs and persons authorized to
deduct tax at source are not required to file annual return.
Q 18. Is an Annual Return and a Final Return one and the
same?
Ans. No. Annual Return has to be filed by every registered taxable
person paying tax as a normal or a compounding taxpayer. Final Return has to be
filed only by those registered taxable persons who have applied for cancellation
of registration. This has to be filed within three months of the date of
cancellation or the date of cancellation order.
Q 19. If a return has been filed, how can it be revised if
some changes are required to be made?
Ans. In GST since the returns are built from details of individual
transactions, there is no requirement for having a revised return. Any need to
revise a return may arise due to the need to change a set of invoices or debit/
credit notes. Instead of revising the return already submitted, the system will
allow changing the details of those transactions (invoices or debit/credit notes)
that are required to be amended. They can be amended in any of the future GSTR-
1/2 in the tables specifically provided for the purposes of amending previously
declared details.
Q 20. How can taxpayers file their returns?
Ans. Taxpayers will have various modes to file the statements
and returns. Firstly, they can file their statement and returns directly on the
Common Portal online. However, this may be tedious and time taking for
taxpayers with large number of invoices. For such taxpayers, an offline utility
will be provided that can be used for preparing the statements offline after
downloading the auto populated details and uploading them on the Common Portal.
GSTN has also developed an ecosystem of GST Suvidha Providers (GSP) that will
integrate with the Common Portal.
Q 21. What all should a diligent taxpayer ensure for a
hassle free compliance under GST?
Ans. One of the most important things under GST will be timely
uploading of the details of outward supplies in Form GSTR-1 by 10th of next
month. How best this can be ensured will depend on the number of B2B invoices
that the taxpayer issues. If the number is small, the taxpayer can upload all
the information in one go. However, if the number of invoices is large, the
invoices (or debit/ credit notes) should be uploaded on a regular basis. GSTN
will allow regular uploading of invoices even on a real time basis. Till the
statement is actually submitted, the system will also allow the taxpayer to modify
the uploaded invoices. Therefore, it would always be beneficial for the
taxpayers to regularly upload the invoices. Last minute rush will make
uploading difficult and will come with higher risk of possible failure and
default. The second thing would be to ensure that taxpayers follow up on
uploading the invoices of their inward supplies by their suppliers. This would
be helpful in ensuring that the input tax credit is available without any
hassle and delay. Recipients can also encourage their suppliers to upload their
invoices on a regular basis instead of doing it on or close to the due date.
The system would allow recipients to see if their suppliers
have uploaded invoices pertaining to them. The GSTN system will also provide
the track record about the compliance level of a tax payer, especially about his
track record in respect of timely uploading of his supply invoices giving
details about the auto reversals that have happened for invoices issued by a
supplier. The Common Portal of GST would have pan India data at one place which
will enable valuable services to the taxpayers. Efforts are being made to make
regular uploading of invoices as easy as possible and it is expected that an
enabling ecosystem will develop towards this objective. Taxpayers should make
efficient use of this ecosystem for easy and hassle free compliance under GST.
Q 22. Is it compulsory for taxpayer to file return by himself?
Ans. No. A registered taxpayer person can also get his return
filed through a Tax Return Preparer, duly approved by the Central or the State
tax administration.
Q 23. What is the consequence of not filing the return
within the prescribed date?
Ans. A registered taxable person who files return beyond the
prescribed date will have to pay late fees of rupees one hundred for every day
of delay subject to a maximum of rupees five thousand.