Features of New GST Returns

Key Features of New Returns as discussed in the GST Council’s 27th, 28th and 31st Meetings are as under:

A. Monthly GST return:

– All taxpayers (having previous year aggregate turnover exceeding 5 crore ) excluding small taxpayers and a few exceptions like lSD etc. shall file one monthly return.

– Taxpayers opting for monthly return whose previous year aggregate turnover is up to 5 crore, shall be able to declare all types of outward supplies, inward supplies and take credit on missing invoices.

B. Quarterly Returns:

For taxpayers whose previous year aggregate turnover is up to 5 crore, may opt to file Return (RET 1) at quarterly basis; No credit on missing invoices

• • Sahaj: B2C category only
  • Sugam: B2C and B2B category

C. Staggered date: The due date for filing of return by a largetaxpayer shall be 20th of the next month whereas the due date for the smaller taxpayers shall be 25th.

D. Continuous uploading and viewing of Invoices:

• Facility for continuous upload of invoices by the supplier and viewing by the recipient along with tax payment status of an invoice shall be available.
• Invoice uploaded but return not filed: In cases where no return is filed after uploading of the invoices, It shall be treated as self- admitted liability by the supplier.
• Uploaded invoices in the annexure of the return shall auto- populate the main liability table of the return.

E. Locking of invoices: Locking of invoices means a handshake between the recipient and supplier indicating acceptance of the transaction reported in the invoice. Facility for locking of invoice by the recipient before filing of the return shall be available. Locked invoices can not be amended.

F. Pending invoices: Pending invoices are invoices which have been uploaded by the supplier for which supplies have not been received or the recipient is of the view that the invoice needs amendment.

G. No automatic reversal of credit:

• There shall not be any automatic reversal of Input tax credit at the recipient’s end where tax has not been paid by the supplier.
• The first response of revenue administration in case of default in payment of tax shall be to recover it from seller.
• In some exceptional circumstances like missing dealer, closure of business by the supplier, recovery of input tax credit from recipient shall be through a due process of service of notice and personal hearing.

H. Periodicity of filing return –

• Periodicity of filing return will be deemed to be monthly for all taxpayers unless quarterly filing of the return is opted for.
• For newly registered taxpayers, turnover will be considered as zero and hence they will have the option to file monthly, Sahaj, Sugam or Quarterly (Normal) return.
• Change in periodicity of the return filing (from quarterly to monthly and vice versa) would be allowed only once at the time of filing the first return by a taxpayer.
• The periodicity of the return filing will remain unchanged during the next financial year unless changed before filing the first return of that year.
• The taxpayers opting to file quarterly return can choose to file any of the quarterly return namely – Sahaj, Sugam or Quarterly (Normal).

I. Sahaj:

• Taxpayers opting to file quarterly return as ‘Sahaj’ shall be allowed to declare outward supply under B2C category and inward supplies attracting reverse charge only.
• Such taxpayers cannot make supplies through e-commerce operators on which tax is required to be collected under section 52.
• Such tax payers shall not take credit on missing invoices and shall not be allowed to make any other type of inward or outward supplies. However, such taxpayers may make Nil rated, exempted or Non-GST supplies which need not be declared in the said return

J. Sugam:

• Taxpayers opting to file quarterly return as ‘Sugam’ shall be allowed to declare outward supply under B2C and B2B category and inward supplies attracting reverse charge only. Such taxpayers cannot make supplies through e-commerce operators on which tax is required to be collected under section 52. Such tax payers shall not take credit on missing invoices and shall not be allowed to make any other type of inward or outward supplies. However, such taxpayers may make Nil rated, exempted or Non-GST supplies which need not be declared in said return.
• Taxpayers opting to file monthly return or Quarterly (Normal) return shall be able to declare all types of outward supplies, inward supplies and take credit on missing invoices.

K. Quarterly Return Filers:

• Taxpayers opting to file the return on quarterly basis have to make payment on monthly basis on the supplies made during the month.
• Only eligible ITC shall be claimed through this FORM.
• Payment of self-assessed liabilities shall be made for the first two months of the quarter.
• Credit of the tax paid during the first two months of the quarter shall be available at the time of filing the return for the quarter.
• Payment of the self-assessed liabilities shall be made by 20th of the month succeeding the month to which the liability pertains.
• Liability and input tax credit availed shall be based on self- assessment subject to adjustment in the main return of the quarter.

L. Amendment of return:

• To err is human and therefore the new return design provides facility for amendment of invoice and also the other details filed in the return.
• Amendment shall be carried out by filing of a return called amendment return. For each of the tax period, up to two amendment returns can be filed.
• Filing process of amendment return( GST RET-1A) will be similar to the filing process of original return (FORM GST RET-1).
• Entries made by the taxpayer in the main return (FORM GST RET-1) which were not auto-populated shall be editable in this return.
• Payment can be made if liability arises due to filing of amendment return. If liability becomes negative then no refund shall be paid. However, it will be carried forward to the main return (FORM GST RET – 1) of next tax period where adjustment can be made.

M. Annex 1 and Annex 2

• Uploading of supply details through an annexure GST ANX-1
• ANX-1 shall contain details of outward supply, inward supply on which tax is payable under RCM and import of goods and services details
• The details uploaded will be made available in annexure GST ANX-2 to recipient on near real time basis.
• In ANX-2, only action to accept, reject and pending has to be taken before filing return.
• If no action is taken, then all documents will be treated as deemed accepted by recipient for the purpose of availing ITC
• Details of the documents (invoice, credit/debit notes) can be uploaded any time during the month till filing of return. Documents uploaded up to 10th of the following month shall be made available to the recipient for claiming ITC.
• Documents uploaded after 10th of following month shall be made available to the recipient in the next month.
• Matching of ANX-2 with Purchase Register
• Matching will be done on seven parameters:
  • GSTIN; Document type; Document number; Document date; Taxable value; Tax amount (total); Tax amount head wise
• Out of the above, first two parameters treated as primary key for the purpose of matching.

N. Types of Mismatch

• Exact match – If all seven parameters matches.
• Partial match – First two primary parameter matches and any one of the remaining five parameters does not match.
• Probable match – One or both of two primary parameters not matching, remaining five parameters match.

O. Provision for refinement (Tolerance limit and approximation)

• Provision for tolerance limit in amount of tax
• Provision for approximation on document number

P. Input Tax Credit:

• Recipient will get credit during a tax period on the basis of the details of documents uploaded by the supplier up to the 10th of the month following the month for which the return is being filed for. Such credit can be availed i.e. credited to the ledger of the recipient only on filing of his (i.e. recipient’s) return. There may be following two scenarios:

i. If the recipient files his return on a monthly basis, say, for the month of January, 2019 on 20th February, 2019, he shall be eligible to take credit in his return based on the documents uploaded by the supplier upto the 10th of February, 2019 irrespective of whether the supplier files his return on monthly or quarterly basis.

ii. If the recipient files his return on a quarterly basis (Normal, Sahaj or Sugam), say for the quarter January – March, 2019 on 25th April, 2019, he shall be eligible to take credit in his return based on the documents uploaded by the supplier up to the 10th of April, 2019 irrespective of whether the supplier files his return on monthly or quarterly basis.

• Recipient can take action on the auto-populated documents to – Accept, Reject or to keep pending on continuous basis after 10th of the month following the month in which such documents have been uploaded.
• Accepted documents will mean that supplies reported in such document have been received before filing of return by the recipient and the details given in the documents reported in FORM GST ANX-1 are correct. Accepted documents would not be available for amendment at the corresponding supplier’s end.
• An invoice with an error that cannot be corrected through a financial debit / credit note shall be rejected.
• Pending action will mean that the recipient has deferred the decision of accepting or rejecting the details of the invoices. There may be multiple reasons for the same such as supplies are yet to be received or the recipient decides that ITC is not to be taken for the time being etc.
• The input tax credit in respect of pending invoices shall not be accounted for in table 4A of the main return (FORM GST RET-1) of the recipient and such invoices would be rolled over to FORM GST ANX-2 of the next tax period.
• Pending invoices will not be available for amendment by the supplier until rejected by the recipient.

Source- GST, CBIC