Data Management in Tally

37th GST Council Meeting Updates

Posted on by Tally Academy

37th-GST-Council-Meeting-updates_Blog-Banner

The GST Council, headed by Union Finance Minister Nirmala Sitharaman and comprising representatives of all States and Union Territories (UTs), had its 37th meeting in Goa in the backdrop of economic growth hitting a six-year low of 5% for the first quarter of the current fiscal. This GST Council Meeting was extremely crucial as various industries were looking forward to some major decisions to be taken in terms of tax slabs.

There have been demands pouring in from various sectors — from biscuits to automobiles and FMCG to hotels — to reduce tax rates in the wake of economic slowdown.

Here are the key decisions during the 37th GST Council Meeting held in Panaji, Goa which are said to be effective from October 1, 2019.

GST Rates Revisions

  • GST Council recommends lower 12% cess on 1,500 cc diesel, 1,200 cc petrol vehicles with capacity to carry up to 13 people.
  • GST rate on caffeinated beverages raised from 18% to 28% with 12% compensation cess.
  • Uniform GST rate of 12% to be levied on polypropylene bags and sacks used for packing of goods
  • GST exempted on specified defence goods not manufactured in India
  • Rate levied on cut and polished semi-precious stones has been dropped from 3% to 0.25%.
  • Jewellery exports to now attract zero GST.
  • GST on fishmeal used by fishermen being exempted from July 2017 to September 30 this year. There was lack of clarity on their GST coverage and no tax was collected so that has been resolved.
  • GST rate hiked on railway wagon, coaches from 5% to 12%.
  • For Transaction value per unit per day of ₹1000 or less, will attract nil GST. For ₹1001 upto ₹7500, now the tax rate will be 12%. Anything above ₹7501 will attract 18%. It was 28% till now.
  • To reduce the rate of GST on hotel accommodation service as below:
Transaction Value per Unit (Rs) per day GST
Rs 1000 and less Nil
Rs 1001 to Rs 7500 12%
Rs 7501 and more 18%
  • To exempt services provided by an intermediary to a supplier of goods or recipient of goods when both the supplier and recipient are located outside the taxable territory.

New Returns

  • Waiver off the requirement of filing FORM GSTR-9A for Composition Taxpayers for FY 2017-18 and FY 2018-19
  • Filing of FORM GSTR-9 for those taxpayers who (are required to file the said return but) have aggregate turnover up to Rs. 2 crores made optional for FY 2017-18 and FY 2018-19
  • A committee to examine simplification of Forms for Annual Return and reconciliation statement
  • New return system now to be introduced from April 2020 (earlier proposed from October 2019)
  • The imposition of restrictions on availing of input tax credit by the recipients in cases where details of outward supplies are not furnished by the suppliers.

Other Crucial Updates

  • Group insurance schemes for paramilitary forces under the Home Affairs ministry to be exempted from GST.
  • Aerated drink manufacturers shall not be under the composition scheme anymore.
  • Rate reduction on hotel accommodation services.
  • Job work services related to diamonds reduced from 5% to 1.5%. For machine job works in engineering industry, GST down from 18 to 12. But bus body building works still taxed at 18%.
  • Restriction on refund of compensation cess on tobacco products (in case of inverted duty structure)
  • Reasonable restrictions on passing of credit by risky taxpayers including risky new taxpayers
  • Link Aadhar with registration of taxpayers under GST and examine the possibility of making Aadhar mandatory for claiming refunds
  • Integrated refund system with disbursal by single authority to be introduced from 24th September 2019

Filing Annual Return GSTR-9 using Annual Computation Report in Tally.ERP 9

Posted on by Tally Academy

Filing-Annual-Return-GSTR-9-using-Annual-computation-Report_Blog-Banner-min

For most of the business, if not all, this was going to be ‘All-hands on the deck’ moment. But it isn’t anymore. Why? First, the fast approaching deadline to file annual GST return is extended and the revised last date to file the annual return in Form GSTR-9 is 30th November,2019. You got little more time to file your annual return. Second, you will figure it out by the time you reach mid of this article.

In many ways, the annual return ‘Form GSTR-9’ is different from the annual returns you have filed so far in the erstwhile regime. The annual GST return ‘Form GSTR-9’ is not a self-assessed consolidated return which used to be the case in the previous indirect tax regime. Meaning, annual return GSTR-9 form will have the consolidated system computed information which you have reported in Form GSTR-1, GSTR-3B and GSTR-2A.

This implies, you have 3 different data points – system computed GSTR-9, values reported in GSTR-1 and GSTR-3B for F.Y 17-18 and the books of accounts. The ideal situation is that the information in Form GSTR-1, Form GSTR-3B and books of accounts should be in sync with each other, and the values should match across different forms and the books of accounts.

Who doesn’t like to be in this situation?  Off course! This is a happy situation and every business would like to be. But, owing to serval reasons, this isn’t going to be an ideal situation for most of the business. This calls for little more efforts to drill down to each of these data points, match, apply the suitable correction and prepare the GSTR-9.

Not considering either of the data (Portal and Books) will possibly result in incorrect annual return filing. There isn’t any easy way to do it. Books and portal data need to be matched and suitable modification (If any) needs to be carried out in system computed GSTR-9. This isn’t little, it’s really an ‘All hands on the desk’ situation.

To alleviate the above situation and help you file annual return GSTR-9 on-time, Tally.ERP is enhanced with ‘Annual Computation’ report which helps you get the values ‘as per book’ computed annually and use this to match with the system computed values of GSTR-9 in GST portal.

The ‘Annual Computation’ report focus on GST Liability and Input Tax Credit values for the entire year with a break-up of details as sought in GSTR-9. You will also be able to view the month-wise break-up of the values on drill down from the report. Below is the glimpse of the annual computation report.

1 copySummary View of Annual Computation Report in Tally.ERP 9

2 copy

Detailed View of Annual Computation Report in Tally.ERP 9

With the cumulative values and break up details available, you will be in a position to compare your book values with uploaded returns and make the necessary modification (if any) to Form GSTR-9 return values.

In case of any difference in book values and portal, you can make the necessary changes either in your books or in the annual return to ensure that the uploaded returns are true to your book values. This also ensures that discrepancy of periodic returns is corrected in annual returns such that book values are same as the uploaded returns for the financial year.

Click Here to know more on how does Annual Computation report help in filing annual returns Form GSTR-9?

Any additional tax due to modification or additions (not furnished in GSTR-1 or GSTR-3B) can be paid along with interest Form GST DRC-03. Similarly, if modifications lead to refund (if eligible) can be applied through Form GST RFD-01A. Note, unveiled ITC cannot be availed and it shall lapse.

Filing Your Annual Returns – Things to Keep in Mind

Posted on by Tally Academy

Filing-Your-Annual-Returns-–-Clarifications-and-Highlights_Blog-Banner-min

As most of you are aware, the last date for filing the annual return in Form GSTR 9 is 30th June 2019. Both traders, as well as industry stakeholders, have raised certain queries with respect to the filing of this annual return, which we will attempt to clarify in this blog:

  • Information contained in Form GSTR 2A as on 1st May 2019 shall be auto-populated in Table 8A of Form GSTR 9.
  • Input Tax Credit on inward supplies shall be declared from April 2018 to March 2019 in Table 8C of Form GSTR 9.
  • Particulars of the transactions for FY 2017-18 declared in returns between April 2018 to March 2019 shall be declared in Part V of Form GSTR 9. Such particulars may contain details of amendments furnished in Table 10 and Table 11 of Form GSTR 1.
  • It may be noted that irrespective of when the supply was declared in Form GSTR 1, the principle of declaring a supply in Part II or Part V is essentially driven by – when was tax paid through Form GSTR 3B in respect of such supplies. If the tax on such a supply was paid through Form GSTR 3B between July 2017 to March 2018 then such a supply shall be declared in Part II and if the tax was paid through Form GSTR 3B between April 2018 to March 2019 then such a supply shall be declared in Part V of Form GSTR 9.
  • Any additional outward supply which was not declared by the registered person in Form GSTR 1 and Form GSTR 3B shall be declared in Part II of the Form GSTR 9. Such additional liability shall be computed in Part IV and the gap between the “tax payable” and “paid through cash” column of Form GSTR 9 shall be paid through Form DRC 03.
  • Many taxpayers have reported a mismatch between auto-populated data and the actual entry in their books of accounts or returns. One common challenge reported by taxpayer is in Table 4 of Form GSTR 9 where details may have been missed in Form GSTR 1, but the tax was already paid in Form GSTR 3B and therefore taxpayers see a mismatch between auto-populated data and data in Form GSTR 3B. It may be noted that auto-population is a functionality provided to taxpayers for facilitation purposes, taxpayers shall report the data as per their books of account or returns filed during the financial year.
  • Many taxpayers have represented that Table 8 has no row to fill in credit of IGST paid at the time of import of goods but availed in the return of April 2018 to March 2019. Due to this, there are apprehensions that credit which was availed between April 2018 to March 2019 but not reported in the annual return may lapse. For this entry, taxpayers are advised to fill in their entire credit availed on import of goods from July 2017 to March 2019 in Table 6(E) of Form GSTR 9 itself.
  • Payments made through Form DRC 03 for any supplies relating to period between July 2017 to March 2018 will not be accounted for in Form GSTR 9 but shall be reported during reconciliation in Form GSTR 9C.

In addition to these clarifications, the GST Council has requested all taxpayers to file their Annual Returns at the earliest to avoid any last-minute rush.

New GST Mechanism Implementation: A Timeline

Posted on by Tally Academy

GST-Mechanism_Blog-Banner

The recently held 31st GST council meet came up with a decision a new GST return system will be introduced to facilitate taxpayers. To initiate a smooth transition to the newly introduced return system, a transition plan has been laid out. Unveiling a roadmap for the implementation of the new GST mechanism, the Finance Ministry transition plan will come in subsequent phases. Here are the details of the indicative transition plan:

Picture1

May 2019:

To understand the interface and ease of transition, a prototype of the offline tool has been shared with the taxpayers. While the navigation of both online and offline tools is similar, taxpayers need to be aware that there are three main components to the new return – one main return (FORM GST RET-1) and two annexures (FORM GST ANX-1 (Sales) and FORM GST ANX- (Purchases)).

July to September 2019:

From July 2019, for to get familiarised, users will be able to upload invoices using the FORM GST ANX1 offline tool on trial basis. They can also view and download, the inward supply of invoices using the FORM GST ANX-2 offline tool under the trial program. The summary of inward supply invoices will also be available for view on the common online portal. In addition to this, August onwards, users can easily identify mismatches by importing their purchase register in the offline tool and match it with the downloaded inward supply invoices. July to September will be defined as a trial period for taxpayers. Since this is only to get the taxpayers familiarised with the tool’s interface, their entries would have no impact at the back end on the tax liability or input tax credit of the taxpayer. In this period, taxpayers will continue to file existing return forms (GSTR-1 and GSTR-3B). Taxpayers will be penalised if they fail to file their GST returns on time.

October to November 2019:

October 2019 onwards FORM GSTR-1 will be replaced by FORM GST ANX-1 and will mark the emendation of FORM GST ANX-1. Actions for both large and small taxpayers will be difference in the coming months.

For Large taxpayers, whose aggregate turnover in the previous financial year over Rs 5 crores:

  • They would upload their monthly FORM GST ANX-1 from October 2019 onwards.
  • For October and November 2019, they would continue to file FORM GSTR-3B on monthly basis.
  • They would file their first FORM GST RET-01 for the month of December 2019 by 20th January 2020

For Small Taxpayers with an aggregate of up to Rs 5 crores:

  • The first compulsory quarterly GST ANX-1 will be due only in January 2020, for the October-December 2019 quarter
  • They will stop filing GSTR-3B and start filing GST PMT-08 from October and file their first GST RET-01 for the quarter October-December from January 20, 2020.

While invoices can be uploaded in GST ANX-1 on a continuous basis, both by large and small taxpayers, from October, GST ANX-2 can also be viewed simultaneously during this period but no action will be allowed on it.

January 2020:

From January 2020 onwards, all taxpayers shall be filing FORM GST RET-01 and FORM GSTR-3B shall be completely phased out.

Note: Instructions to file and process the refund applications between October to December 2019 will be notified shortly

Recent Enhancements in E-way Bill

Posted on by Tally Academy

e-way-Bill_Blog-Banner

The e-way bill is one of the key areas crucial for the successful implementation and adaption of GST. Therefore, it is no surprise that the government and the GST Council strives to keep making corrections to the e-way bill experience to make it more seamless as the days go by. About a month back, certain enhancements in the e-way bill were made to help businesses and transporters generate the e-way bill with ease.
The enhancements are largely as follows:
• Auto-calculation of distance based on PIN Codes
• Knowing the distance between two PIN codes
• Blocking the generation of multiple e-way bills on one invoice / document
• Extension of e-way bill in case the consignment is in transit / movement
• Report on list of e-way bills about to expire

Auto-calculation of distance based on PIN codes

First, the e-way bill system has been enhanced with auto-calculation of distance between the source and destination, based on the PIN codes. The system will now calculate and display the estimated motorable distance between the supplier and recipient addresses.

Certain points to note here:

  • The user will still be allowed to enter the actual distance as per the movement of goods, but, it will be restricted to up to 10% more than the auto-calculated distance displayed. For e.g., if the system has displayed the distance between Place A and Place B, based on the PIN codes, as 50 KMs, then the user can enter the actual distance covered up to 55KMs (which is 50 KMs + 5 KMs (i.e. 10% of 50))
  • In case the PIN code of both source and destination are the same, the user will be allowed to enter the distance up to a maximum of 100 KMs
  • If the PIN Code entered is incorrect, the system would alert the user with the message “INVALID PIN CODE”. He can continue entering the distance, but such e-waybills will be flagged for review by the department

Knowing the distance between two PIN codes

Another alternative for the business or transporter to know the distance between source and destination is to follow the steps below:

  • Login to the e-way bill portal homepage – http://ewaybillgst.gov.in
  • Place the cursor on the “Search” tab to view the various options available and select “PIN to PIN Distance”
  • The “PIN to PIN Distance” screen will appear where the user needs to enter “Dispatch From” and “Ship To” PIN codes to show the approximate distance between the two locations
  • The system will show the approximate distance. The calculation of the distance is based on data from various electronic sources, and employs various attributes, such as – road class, direction of travel, average speed, traffic data etc. These attributes are picked up from traffic that is on National highways, state highways, expressways, district highways as well as main roads inside the cities. A proprietary logic is then used for approximating the distance between two postal PIN codes.

Blocking the generation of multiple e-way bills on one Invoice / Document

Based on the representation received from various stakeholders, the government has decided not to permit generation of multiple e-way bills based on one invoice, by any party, be it consignor, consignee or transporter. Which means, if the e-way bill is generated once with a particular invoice number, then none of the parties can generate the e-way bill with the same invoice number. Even if someone tries to generate another e-way bill using the same document number, the system will not allow the same and display an error message. In short, “One Invoice, One E-way bill” policy will be followed.

Extension of e-way bill in case the consignment is in Transit / Movement

Many transporters had proposed to incorporate the provision to extend the e-way bill, when the goods are in transit / movement. To do so, they need to follow the steps below:

  • Login to the e-way bill portal homepage – http://ewaybillgst.gov.in
  • Navigate to “E-way Bill Module” > “Extend Validity” > Enter the e-way bill number to fill the extension validity form
  • Choose “Yes” for extension for e-way bill, upon which transportation details will appear in Part B of the form
  • Select the position of the consignment as “In Transit” / “In Movement”
    • On selection of “In Movement” the system will prompt the user to select the “Mode” and “Vehicle Details”
    • On selection of “In Transit”, the user needs to select the “Transit Type” i.e. “On Road”, “Warehouse” or “Others” – followed by the address of the transit place
  • In both the scenarios above, the destination PIN will be considered from the Part A of the e-way bill for calculation of the distance for movement and validity date.

Report on list of e-way bills about to expire

Businesses or transporters can now view the list of e-way bills about to expire in a period of 4 days, and thus keep track of expiry dates for each of the consignments generated. For doing this, the user needs to follow the steps below:

User can login to the e-Way Bill portal (https://ewaybillgst.gov.in/) and navigate through the menu as illustrated below to reach the list (Figure-11).

  • Login to the e-way bill portal homepage – http://ewaybillgst.gov.in
  • Navigate to “Reports” > “My EWB Reports” > “EWB about to Expire”
  • The report will be populated. The user can utilize the report to analyse the data and ensure that that the goods reach the destination within validity time

Watch this space for more such updates on the e-way bill.

5 E way Bill Changes from 16th November 2018

Posted on by Tally Academy

On the 12th of November 2018, certain enhancements to the e-way bill process were proposed by the National Informatics Centre. These changes, which seek to improve the e-way bill experience for businesses and transporters alike, are to go live from 16th November, 2018. Let’s go through these 5 e way bill changes one by one, to understand how they will impact you and your business:

Checking for duplicate e-way bills based on same invoice number

Earlier, the e-way bill system was not equipped to check for duplicates based on the invoice number. Thus, if multiple e-way bills were generated against the same invoice number, either by intention or accident, the system was allowing that to happen, resulting in problems. But as per the e way bill changes from 16th November 2018, the system will not allow the consignor or the supplier to generate duplicate e-way bills. The system will check for duplicates based on the consignor’s GSTIN, document type and document number. Thus, if one e-way bill has already been generated against one invoice, no additional e-way bills against the same invoice will be allowed. The same will hold true for transporters and consignees as well – they too will not be allowed to raise e-way bills, if the e-way bill has already been generated by the consignor against a particular invoice. Not just that, if the transporter or consignee has generated one e-way bill against the consignor’s invoice, and any other party tries to generate the e-way bill, the system will immediately alert the user that one e-way bill is already present against that invoice.

Options for CKD, SKD and Lots

As per the latest e way bill changes, the options for “CKD” (Completely Knocked Down), “SKD” (Semi Knocked Down) and “Lots” for the “Supply Type” field will come in to play, which is particularly useful, whenever big consignments are broken down and moved in batches. The same also applies for export and import consignments, where a single consignment may be too big to be moved from supplier to recipient.

Handling Addresses for Export & Import Consignments

For export consignments:

  • “Bill To” party will be “URP” (Unregistered Person) or GSTIN of SEZ unit with “State” as “Other Country”
  • Shipping Address and PIN Code will be of the location (airport / shipping yard / border check post) from where the consignment is moving out from the country

For import consignments:

  • “Bill From” party will be “URP” (Unregistered Person) or GSTIN of SEZ unit with “State” as “Other Country”
  • Dispatching Address and PIN Code will be of the location (airport / shipping yard / border check post) from where the consignment is entering the country

Handling Bill to – Ship to Transactions

From 16th November 2018, the e-way bill portal will be fully equipped to handle “Bill To – Ship To” transactions. Such transactions are primarily of 4 types, depending upon the number of parties involved in the billing and movement of goods. The types are as follows:

  • Type 1 – Regular: This is a regular or normal transaction, where billing and movement of goods is happening directly between two parties – consignor and consignee.
  • Type 2 – Bill To – Ship To: In this type of transaction, three parties are involved. Billing takes places between consignor and consignee, but the goods move from consignor to the third party as per the request of the consignee.
  • Type 3 – Bill From – Dispatch From: In this type of transaction also, three parties are involved. Billing takes places between consignor and consignee, but the goods are moved by the consignor from the third party to the consignee.
  • Type 4 – Combination of both: This is the combination of Type 2 and Type 3 and involves a total of four parties. Billing takes places between consignor and consignee, but the goods are moved by the consignor from the third party to the fourth party, as per the consignee’s request.

E way Bill changes in Bulk Generation Tool

Amongst other e way bill changes, certain new columns have been added in the Bulk Generation Tool facility of the portal. More information on the same will be made available on 16th November 2018, and we promise to share the same with you in the next few days.

Annual Return GSTR 9 Format

Posted on by Tally Academy

Annual-Return-GSTR-9

By definition, form GSTR 9 is a consolidated return of all the returns filed during the previous financial year. The annual return which is due on 31st December, 2018 should be filed with the consolidated details of all returns filed from July’17 to March’18. On 4th September, 2018, CBIC has notified the annual return GSTR 9 format in which the consolidated details need to be captured by the taxpayers.

To know more on applicability and due date to file annual return GSTR 9, please read our blog Annual Return GSTR 9,’ In this blog, we will discuss about the annual return GSTR 9 format.

Annual Return GSTR 9 Format

The annual return GSTR 9 format consists of 6 parts in which the details of supplies made or received during the period of July’17 to March’18 need to be captured. The details required in all 6 parts of GSTR 9 format is only at the consolidated level. The following are the 6 parts of GSTR 9 format as notified by the CBIC.

Part-1 of GSTR 9 Format Basic Details of Taxpayer
Part-2 of GSTR 9 Format Details of outward and inward supplies declared during the financial year
Part-3 of GSTR 9 Format Details of ITC as declared in returns filed during the financial year
Part-4 of GSTR 9 Format Details of tax paid as declared in returns filed during the financial year
Part-5 of GSTR 9 Format Particulars of the transactions for the previous FY declared in returns of April to September of current FY or up to the date of filing of annual return of previous FY whichever is earlier
Part-6 of GSTR 9 Format Other Information such as demands and refunds, HSN Summary, Late Fee supplies received from composition taxpayers, deemed supplies etc.

Part-1 of GSTR 9 Format

In Part -1 of annual return, you need to capture the basic registration details of the taxpayer. The details such as fiscal year, GSTIN, legal name and Trade name (if any) need to be captured. These details will be auto-captured once the annual return form GSTR 9 is made available in the GST portal.

Part-2 of GSTR 9 Format

In Part-2 of annual return form, you need to capture the consolidated details of outward supplies as declared in the returns filed during the financial year. The Part-2 is further split into the following two sections:

  • Supplies on which tax is payable: All taxable supplies (both B2B and B2C), exports on payment of tax, supplies to SEZ on payment of tax, inward supplies attracting reverse charge and advance received (but invoice is yet to be issued) need to be captured.
  • Supplies on which tax is payable: This includes exports and SEZ supplies without payment of tax, outward supplies on which tax is to be paid on a reverse charge, exempt supplies, nil rated supplies and non-GST supplies.

You also need to capture the consolidated details of Debit note, Credit notes and amendments related to supplies separately.

Part-3 of GSTR 9 Format

The part -3 of annual return consist of all input tax credit availed and reversed in the financial year for which the annual return is filed. This part is further split into the following 3 sections:

  • ITC availed as declared in the returns filed: In this section, ITC availed through Form GSTR-3B will be auto-captured and you are required furnish the ITC availed on different nature of Inward supplies such as B2B, B2C, Imports etc. with a break-up of Inputs, Input services and capital goods. Ideally, there should not be any difference between the ITC claimed in GSTR-3B and the details declared in this section. This section will also include the transition credit availed through Tran-1 and Tran-2.
  • ITC reversed and ineligible ITC: Here, you need to furnish the details of ITC reversed owing to various reasons such as used in making exempt supplies, non-business use etc. Also, the ineligible ITC as declared in the Form GSTR-3B.
  • Other ITC related Information: In this section, the ITC as per form GSTR-2A will be auto-populated and you have to give the details of ITC availed on B2B inward supplies, ITC reclaimed and ITC availed after March’18 for inward supplies received from July –March’18. You also need to declare the details of ITC available but not availed, ITC available but not ineligible, IGST credit on import of goods etc.

Part-4 of GSTR 9 Format

In part of 4 of the annual return GSTR 9 format, the actual tax paid as declared in the returns filed during the previous financial year need to be captured. Tax-wise break-up of tax payable, tax paid in cash and paid through ITC should be furnished.

Part-5 of GSTR 9 Format

In part 5 of GSTR 9, you need to declare the details of transactions related to previous financial year but declared in the returns of April to September of current FY (2018-2019) or date of filing of annual return for the previous financial year, whichever is earlier.

For example in the annual return for the FY 2017-18, the transactions related to July –March’18 are declared in the returns filed in April to September 2018. Let’s say, ITC is availed on an invoice dated 15th February, 2018 in GSTR-3B return of August, 2018 filed on 20th September, 2018. The consolidated details such supplies need to be declared in this section.

Part-6 of GSTR 9 Format

In part of 6 of GSTR 9, you need to capture the following details

  • Details of demands and refunds. This includes Total refund claimed, refund sanctioned, refund rejected, refund pending, the total demand of taxes, demands pending etc.
  • Supplies received from composition dealer, goods sent on approval and deemed supplies.
  • HSN-wise summary of outward supplies
  • Late fee payable and paid.

Conclusion

By now, you would have estimated the amount of efforts and time it requires to file to annual return in GSTR 9. Though the details are at consolidated level, you have to provide the break of supplies either based on nature of supplies (B2B. B2C, Imports, etc.) Or the nature of goods (Input or capital goods). Instead of waiting for the annual return to be activated in GST portal, it recommended for businesses to study the annual return form in detail, understand and start preparing the GSTR 9 now such that you have an ample time to file an accurate annual return.

Key features of new GST quarterly returns

Posted on by Tally Academy

key-features-of-new-gst-quarterly-returns-banner

The new GST quarterly returns are meant for the small businesses in India. It is an initiative by the GST Council to ease compliance procedures for such businesses. In this article, let us understand the key features of the new GST quarterly returns.

Who can file GST quarterly returns?

Persons whose turnover is up to Rs. 5 Crores in the last financial year can file quarterly returns.

Can a small business opt to file the monthly return instead of quarterly return?

A person whose turnover is up to Rs. 5 Crores has an option to file the monthly or quarterly returns. This choice will be taken from taxpayers at the beginning of a year. If the taxpayer wants to change from filing quarterly returns to monthly returns during a year, it can be done once during a year, at the beginning of a quarter.

How are quarterly returns different from monthly returns?

Quarterly returns will be simpler than monthly returns. The following details will not be required to be given in quarterly returns:

  1. a. Missing and pending invoices

Missing invoices are the invoices which a taxpayer’s suppliers have missed uploading. Pending invoices are invoices which have been uploaded by the supplier but for which any of the following three situations exist:

  • The supply has not been received by the recipient
  • The recipient is of the view that the invoices requires amendment
  • The recipient is not able to decide whether to take input tax credit on the invoice for the time being

A person filing quarterly returns will not be able to report missing and pending invoices. The GST Council has decided to omit these details from quarterly returns assuming that small businesses will deal with few known suppliers and situations of missing and pending invoices will not arise. However, in case a business requires the facility to report missing and pending invoices, they can opt to file the monthly returns.

  1. b. Non-GST supplies, exempted supplies, etc. which do not create any liability.
  2. c. Input tax credit on capital goods

However, persons filing quarterly returns will need to fill details of non-GST supplies, exempted supplies and input tax credit on capital goods in the Annual return.

What are the types of quarterly returns?

There will be 3 types of quarterly returns. Taxpayers can file the return which is applicable to them. The types of quarterly returns are:

a. Sahaj

Persons making purchases only from suppliers in India and supplying only to consumers or unregistered persons (B2C) in India can file the Sahaj return.

b. Sugam

Persons making purchases only from suppliers in India and supplying to both registered businesses as well as consumers or unregistered businesses (B2B + B2C) in India can file the Sugam return.

c. Quarterly return

Persons who make imports or exports, in addition to domestic purchases and supplies, can file the quarterly return.

How will the GST return filing procedure be?

The entire process of return filing will be simplified for all taxpayers. You can learn more about the new GST return filing procedure in our blog ‘New GST return filing process- A quick guide’.

Should tax be paid on quarterly basis also?

No, persons filing quarterly returns will need to pay tax on monthly basis. This will be done through a payment declaration form. In the payment declaration form, the taxpayer’s liability based on invoices uploaded will be shown. Similarly, input tax credit based on invoices uploaded by the taxpayer’s suppliers will be shown. Accordingly, the taxpayer can pay tax for each month. The benefit of payment declaration form is that it is not a return and minor mistakes made will not lead to legal action. This will again ensure that small businesses don’t have to pay additional penalties for minor mistakes made in the payment declaration form.

What happens if tax is not paid on monthly basis?

A taxpayer will be liable to pay interest for late payment of the tax due for each month.

Hence, the new GST quarterly returns are aimed at simplifying compliance for small business. Measures such as Sahaj and Sugam returns and the new GST return filing procedure are good steps in this regard. However, businesses must know that quarterly returns do not have the facility of reporting missing and pending invoices. If your business requires these facilities, it is recommended to opt for monthly returns.

Key features of new GST monthly returns

Posted on by Tally Academy

key-features-of-new-gst-monthly-returns-banner

In the 28th GST Council meeting, the GST Council approved the new GST monthly returns. These had also been placed in the public domain for feedback from businesses, CAs and industry bodies. A major change in the new GST returns is the simplified monthly return to be filed by persons whose turnover is more than Rs. 5 Crores. Let us understand the key features of the new monthly GST returns.

Applicability of new GST monthly returns

All regular taxpayers whose turnover is more than Rs. 5 Crores must file the monthly GST return. Even persons having turnover up to Rs. 5 Crores can opt to file the monthly return, instead of the quarterly return.

Due date of new GST monthly returns

The due date for filing the new GST monthly returns will be 20th of the next month.

Advantage of filing new GST monthly returns versus quarterly returns

Taxpayers filing the GST monthly returns will have the capability to report missing and pending invoices, which a person filing quarterly returns will not be able to. The feature of missing invoices gives recipients the power to report invoices which suppliers have missed uploading. Pending invoices are invoices which have been uploaded by the supplier but for which any of the following three situations exist:

  1. The supply has not been received by the recipient
  2. The recipient is of the view that the invoices requires amendment
  3. The recipient is not able to decide whether to take input tax credit on the invoice for the time being

These are two important capabilities that a business filing quarterly returns will not have. Hence, even businesses having turnover upto Rs. 5 Crores must evaluate their suppliers and ensure that they choose monthly returns in case they would like the facility to report missing or pending invoices.

Profile based return

Since most taxpayers have limited types of supplies and limited types of inputs, the fields shown in the GST return will be based on the profile of the taxpayer. To understand the profile of the taxpayer, a questionnaire will be used. Fields such as exports, supplies to SEZ, etc. will be shown only if the taxpayer makes such supplies.

New return filing process

The entire process of return filing will be simplified for all taxpayers. You can learn more about the new return filing process in our blog ‘New GST return filing process- A quick guide’.

Facility to file ‘Amendment return’

Taxpayers can now file amendment returns to rectify wrong entries made in returns filed. Two amendment returns can be filed for each tax period. However, if the difference in tax liability shown in the amendment return is more than 10%, a higher late fee will be due.

File Nil GST monthly return by SMS

Persons who have no purchases, no output tax liability and no input tax credit in any quarter can file one nil return for the entire quarter. Facility to file the nil return by simply sending an SMS will be made available.

Hence, the new GST monthly returns will be simpler for taxpayers, with all the above facilities being made available. In addition, the new return filing process will also make taxpayers’ lives easier. A key benefit for persons filing monthly returns is the feature of reporting missing and pending invoices. In our next article, we will understand the key features of the new GST quarterly returns.

Last Chance to claim Unclaimed ITC – GSTR-3B

Posted on by Tally Academy

Last-Chance-to-claim-Unclaimed-ITC-_Blog-Banner-min

The GSTR-3B of September, 2018 is little different compared to the GSTR-3B which you had filed all these days. The difference here is not about the format rather it is about compliance activities, effort and time involved in filing GSTR-3B of September, 2018.

Yes, you guessed it right! The difference is all about the last chance to claim unclaimed ITC on invoices pertaining to July’2017 to March’2018.

You might be aware that Input tax credit pertaining to invoices issued by the suppliers during 1 July 2017 to 31 March 2018 needs to be claimed on or before filing GSTR-3B of September, 2018. This implies that the last opportunity for you to claim ITC is to report it in GSTR-3B of September, 2018.

The good news is that the due date to file GSTR-3B is extended to 25th October, 2018 which was originally dated to 20th October, 2018.

Let us consider an example for ease of understanding.

If an invoice is issued by the supplier on 31 March 2018 and If ITC is not claimed on such Invoice in any of GSTR-3B filed till 25 October 2018, then credit pertaining to such invoice cannot be claimed and it will lapse.

In order to safeguard your ITC from getting lapsed, the following are some of the key actions which you need to consider before filing GSTR-3B of September, 2018.

  • Download GSTR-2A from GST Portal
  • Reconcile GSTR-2A with your books of Accounts.
  • The reconciliation activity involves line-wise comparison of your purchase register with GSTR-2A.
  • Post reconciliation, identify the purchases pertaining to July’17 to March’2018 on which ITC is not claimed.
  • Ideally, purchases which are part of GSTR-2A but not reflected/accounted in your books are the ones which you need to look for and claim ITC.
  • You may also need to verify your previous GSTR-3B returns to identify the invoices accounted in books but not claimed.
  • After the identification of unclaimed purchase invoice, determine the ITC eligibility on such invoices. Meaning, the ITC should not be either blocked or restricted.
  • Claim eligible ITC on Invoice pertaining July’17 to March’18 by reporting it in GSTR-3B along with ITC of September month.

Reconciliation of books with returns is key for any business to be GST complaint. It is not a one-time activity which you need to do it for availing unclaimed ITC, rather it is a continuous activity which needs to be carried out every month. The Reconciliation of returns with books of accounts will help the businesses in identifying the following:

  • Suppliers who have not filed their GSTR-1
  • Instances where wrong details are being disclosed by your Suppliers
  • Cases where Wrong GSTIN is disclosed
  • Invoices on which ITC has not been availed
  • Mismatch due to Debit notes and credit notes issued

Over and above, it helps you to identify the GAP between 2Aà3BàBooks, follow-up and act on time.

While the benefits of reconciliation are many but you can leverage on these only with help of system assisted reconciliation. The efforts and time involved in manual reconciliation are huge. It involves line-by-line comparison of GSTR-2A with your books of accounts. Therefore, it is recommended that you need to have a software which automates the reconciliation activity by reading the GSTR-2A and the purchase invoices recorded in the books.

Using Tally.ERP 9, you can upload the GSTR-2A and automatically reconcile the purchases accounted in books and GSTR-2A. To know more, please read Reconciliation of GSTR-2A with Books of Accounts