Calculation of Interest & Late Fees on Late Filing of GSTR-3B & GSTR-1

As we all know, during Covid – 19 Government has come up with few notifications on 03^rd April, 2020, 24^th June, 2020 & 30^th June, 2020 for the purpose of extending the due dates for filing of GSTR-3B and GSTR-1 for various months. In this article I am trying to clarify the manner of calculation of interest and late fee in case of delayed filing.

Interest Calculation in case of taxpayers having aggregate turnover exceeding Rs. 5 Crores in the preceeding Financial Year:-

Notification No. 31/2020 – Central Tax dated 03.04.2020 as amended by Notification No. 51/2020 – Central Tax dated 24.06.2020 states the manner of calculation of interest in case of late filing of GSTR-3B for the month of Feb-20, March-20 and April-20. According to this notification read with Circular no. 141/11/2020- GST dated 24^th June, 2020 interest will be calculated as under:

1. For first 15 days delay in filing of return after the due date of GSTR-3B i.e. 20^th March, 20^th April or 20^th May as the case may be interest will be nil;

2. After 15 days delay in filing of return till 24^th June, 2020 interest will be charged @ 9% per annum; and

3. After 24^th June, 2020 interest will be charged at 18% per annum.

*CBIC extends due date for filing of GSTR-3B for the month of May-2020 vide Notification No. 36/2020- Central Tax dated 03.04.2020 and according to this notification due date for the month of May-2020 due date for filing of GSTR-3B is 27.06.2020.

Example No. 1:- Mr. X has filed his return for the month of Feb-2020 on 30^th September, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 20.03.2020. Now, the interest will be calculated as:

• For first 15 days i.e. from 21.03.2020 to 04.04.2020 interest will be nil.
• From 05.04.2020 to 24.06.2020 interest will be charged @ 9% p.a. for 81 days

2,00,000*9%*81/365= 3994/-.

• From 25.06.2020 to 30.09.2020 interest will be charged @ 18% p.a. for 98 days

2,00,000*18%*98/365= 9666/-.

Total interest payable in this case will be Rs. 13,660/-.

Example No. 2:- Mr. X has filed his return for the month of May-2020 on 30^th September, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 27.06.2020 vide Notification No. 36/2020- Central Tax dated 03.04.2020. Now, the interest will be calculated as:

• From 28.06.2020 to 30.09.2020 interest will be charged @ 18% p.a. for 95 days

2,00,000*18%*95/365= 9370/-.

Total interest payable in this case will be Rs. 9,370/-.

Interest Calculation in case of taxpayers having aggregate turnover up to Rs. 5 Crores in the preceeding Financial Year for Group A States:-

Notification No. 31/2020 – Central Tax dated 03.04.2020 as amended by Notification No. 51/2020 – Central Tax dated 24.06.2020 states the manner of calculation of interest in case of late filing of GSTR-3B for the month of Feb-20, March-20, April-20, May-20, June-20 and July-20. According to this notification read with Circular no. 141/11/2020- GST dated 24^th June, 2020 interest will be calculated as under:

1. Till the specified date i.e. the date mentioned in the serial no. 2 of the Notification No. 51/2020 – Central Tax dated 24.06.2020, interest will be nil;

2. After the specified dates till 30^th September, 2020 interest will be charged @ 9% per annum; and

3. After 30^th September, 2020 interest will be charged @ 18% per annum.

* Group A States– Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands or Lakshadweep.

Example No. 1:- Mr. X located in Group A State has filed his return for the month of Feb-2020 on 30^th October, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 22.03.2020. Now, the interest will be calculated as:

• Till the specified date i.e. 30.06.2020 interest will be nil.
• From 01.07.2020 to 30.09.2020 interest will be charged @ 9% p.a. for 92 days

2,00,000*9%*92/365= 4536/-.

• From 01.10.2020 to 30.10.2020 interest will be charged @ 18% p.a. for 30 days

2,00,000*18%*30/365= 2959/-.

Total interest payable in this case will be Rs. 7,495/-.

Example No. 2:- Mr. X located in Group A State has filed his return for the month of May-2020 on 30^th October, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 12.07.2020. Now, the interest will be calculated as:

• Till the specified date i.e. 12.09.2020 interest will be nil.
• From 13.09.2020 to 30.09.2020 interest will be charged @ 9% p.a. for 18 days

2,00,000*9%*18/365= 888/-.

• From 01.10.2020 to 30.10.2020 interest will be charged @ 18% p.a. for 30 days

2,00,000*18%*30/365= 2959/-.

Total interest payable in this case will be Rs. 3,847/-.

Interest Calculation in case of taxpayers having aggregate turnover up to Rs. 5 Crores in the preceeding Financial Year for “Group B” States:-

Notification No. 31/2020 – Central Tax dated 03.04.2020 as amended by Notification No. 51/2020 – Central Tax dated 24.06.2020 states the manner of calculation of interest in case of late filing of GSTR-3B for the month of Feb-20, March-20, April-20, May-20, June-20 and July-20. According to this notification read with Circular no. 141/11/2020- GST dated 24^th June, 2020 interest will be calculated as under:

1. Till the specified date i.e. the date mentioned in the serial no. 3 of the Notification No. 51/2020 – Central Tax dated 24.06.2020, interest will be nil;

2. After the specified dates till 30^th September, 2020 interest will be charged @ 9% per annum; and

3. After 30^th September, 2020 interest will be charged at 18% per annum.

* Group B States– Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha, the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi.

Example No. 1:- Mr. X located in Group B State has filed his return for the month of March-2020 on 15^th October, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 24.04.2020. Now, the interest will be calculated as:

• Till the specified date i.e. 05.07.2020 interest will be nil.
• From 06.07.2020 to 30.09.2020 interest will be charged @ 9% p.a. for 87 days

2,00,000*9%*87/365= 4290/-.

• From 01.10.2020 to 15.10.2020 interest will be charged @ 18% p.a. for 15 days

2,00,000*18%*15/365= 1479/-.

Total interest payable in this case will be Rs. 5,769/-.

Example No. 2:- Mr. X located in Group B State has filed his return for the month of May-2020 on 10^th October, 2020 and his tax liability was Rs. 2,00,000/-. In this case due date for filing of return was 14.07.2020. Now, the interest will be calculated as:

• Till the specified date i.e. 15.09.2020 interest will be nil.
• From 16.09.2020 to 30.09.2020 interest will be charged @ 9% p.a. for 15 days

2,00,000*9%*15/365= 740/-.

• From 01.10.2020 to 10.10.2020 interest will be charged @ 18% p.a. for 10 days

2,00,000*18%*30/365= 986/-.

Total interest payable in this case will be Rs. 1,726/-.

Manner of Calculation of Late Fee for Feb-20 to July-20 for delay in filing of GSTR-3B

The Government vide Notification No. 52/2020 – Central Tax dated 24.06.2020 has revised the dates of Notification No. 32/2020– Central Tax dated 03.04.2020 for conditional waiver of late fee for the months of Feb-20, Mar-20 and Apr-20.  Moreover, for small taxpayers (taxpayers having aggregate turnover up to 5 Crore), above notification has also extended the same for the months of May-20, Jun-20 and Jul-20.

* It is clarified that the waiver of late fee is conditional to filing the return of the said tax period by the dates specified in the said notification. In case the returns in FORM GSTR- 3B for the said months are not furnished on or before the dates specified in the said notification, then late fee shall be payable from the due date of return, till the date on which the return is filed.

Notification No. 52/2020 – Central Tax dated 24.06.2020

 Further, as per Notification No. 57/2020 – Central Tax dated 30.06.2020, if the taxpayer who fail to furnish the return for the period of February 2020 to July 2020 on or before the due dates as specified in Notification No. 52/2020 – Central Tax dated 24.06.2020 but furnish the said return till 30th September 2020 then late fees will be capped to Rs. 500/- (i.e. Rs. 250/- CGST and Rs. 250/- SGST) per return. In cases of taxpayers where tax payable is nil for the period covered above the late fee for that period shall stand fully waived.

Example No. 1:- Mr. X is having turnover of Rs. 6 Crore in the preceeding Financial Year and file his GSTR-3B return and tax payable is Rs. 1 Lakh for the month of Feb-20 on 15^th September, 2020. In this case late fee will be lower of the following:

• 50 per day for the period 21.03.2020 to 15.09.2020 i.e. 179 days

Rs. 50/day* 179 days= 8,950; or

• 500/- (Rs. 250/- CGST and Rs. 250/- SGST)

And, Late fee for the month of Feb-2020 will be Rs. 500/-.

Example No. 2:- Mr. X is having turnover of Rs. 6 Crore in the preceeding Financial Year and file his GSTR-3B return and tax payable is Nil for the month of Feb-20 on 15^th September, 2020. In this case late fee will be lower of the following:

• 20 per day for the period 21.03.2020 to 15.09.2020 i.e. 179 days

Rs. 20/day* 179 days= 3,580; or

• Nil because no tax is payable

And, Late fee for the month of Feb-2020 will be Rs. Nil

Example No. 3:- Mr. X Located in Group A State is having turnover of Rs. 4 Crore in the preceeding Financial Year and file his GSTR-3B return and tax payable is Rs. 5 Lakhs for the month of Mar-20 on 15^th September, 2020. In this case late fee will be lower of the following:

• 50 per day for the period 23.04.2020 to 15.09.2020 i.e. 146 days

Rs. 50/day* 146 days= 7,300; or

• 500

And, Late fee for the month of Mar-2020 will be Rs. 500/-

Example No. 4:- Mr. X is having turnover of Rs. 6 Crore in the preceeding Financial Year and file his GSTR-3B return and tax payable is Rs. 5 Lakhs for the month of May-20 on 15^th October, 2020. In this case full late fee will be charged and no relief will be given because return is filed after 30.09.2020 and calculation of late fee will be as follows:

• 50 per day for the period 28.06.2020 to 15.10.2020 i.e. 110 days

Rs. 50/day* 110 days= 5,500; or

And, Late fee for the month of May-2020 will be Rs. 5,500/-.

Calculation of Late Fee for July- 17 to January -20 for delay in filing of GSTR-3B

The Government vide Notification No. 52/2020 – Central Tax dated 24.06.2020 has stated that total amount of late fee payable for a tax period, under section 47 of the said Act shall stand waived which is in excess of an amount of Rs. 500/- (Rs. 250- CGST and Rs. 250- SGST) for the registered person who failed to furnish the return in FORM GSTR-3B for the months of July, 2017 to January, 2020, by the due date but furnishes the said return between the period from 01st day of July, 2020 to 30th day of September, 2020.

In case where the total amount of tax payable in the said return is nil, the total amount of late fee payable for a tax period, under section 47 of the said Act shall stand waived for the registered person who failed to furnish the return in FORM GSTR-3B for the months of July, 2017 to January, 2020, by the due date but furnishes the said return between the period from 01st day of July, 2020 to 30th day of September, 2020.

Calculation of Late Fee for July- 17 to January -20 for delay in filing of GSTR-1

The Government vide Notification No. 53/2020 – Central Tax dated 24.06.2020 has stated that the amount of late fee payable under section 47 of the said Act shall stand waived for the registered persons who fail to furnish the details of outward supplies for the months or quarter mentioned in column (2) of the Table below in FORM GSTR-1 by the due date, but furnishes the said details on or before the dates mentioned in column (3) of the said Table :-

TABLE

*Extension of Due Dates for the Form GSTR- 3B for the month of May-2020

The Government vide Notification No. 36/2020- Central Tax dated 03.04.2020 has extended the due date for the Form GSTR- 3B for the month of May- 2020. As per said notification due date for the Form GSTR- 3B for the month of May- 2020 is as follows:

For taxpayers having aggregate turnover exceeding Rs. 5 Crore- 27^th June, 2020

For taxpayers having aggregate turnover upto Rs. 5 Crore:-

Group A States- 12^th July, 2020

Group B States- 14^th July, 2020

*Extension of Due Dates for the Form GSTR- 3B for the month of August-2020 for Small Taxpayers

The Government vide Notification No. 54/2020 – Central Tax dated 24.06.2020 has extended the due date for the Form GSTR- 3B for the month of August- 2020 taxpayers having turnover upto Rs. 5 Crore. As per said notification due date for the Form GSTR- 3B for the month of August- 2020 is as follows:

Group A States- 1^st October, 2020

Group B States- 3^rd October, 2020