General Provision related to TDS under GST:-
The section 51 of the Act makes provisions with regards to tax deduction at source by certain recipients. These provisions are similar to provision contained in Income-tax Act, 1961 for deduction of TDS and depositing the same to the credit of Government.
1. Obtaining of Registration:-
2. Persons required to make Deduction of Tax:-
A. A department or an establishment of the Central Government or State Government; or
B. Local authority; or
C. Governmental agencies; or
D. Such persons or category of persons as may be notified by the Government
The Notification No. 33/2017-CT,dated 15/09/2017 specify the following entities also requires to deduct TDS in exercise of power conferred under Clause (d) of Section 51(1).
– An authority or a board or any other body
I. set up by Parliament or a State Legislature or by a government
II. establish by any Government
with 51% or more participation by way of equity or control, to carry out any function
– A society established by the Central or any State Government or a Local Authority and the society is registered under the Societies Registration Act, 1860.
– Public sector undertakings.
No Deducion of tax at Source under GST:-
– Proviso to section 51(1) provides that No tax shall be deducted if the location of supplier and the place of supply is in a state or union Territory which is different from the state of registration of recipient.
– Therefore, before deduction of tax the specified person will have to determine the state or union territory in which he is registered and place of supply.
|Sr.No||Location of Supplier||Location of Recipient||Place of Supply||TDS Applicability|
Date of Deduction of Tax under GST:-
Determination of Value of Supply:-
Procedure for Tax
A specified person shall deduct the tax @ 1% from the payment made or credited to the supplier.
The amount deducted by the specified person shall be paid to the credit of the appropriate government within 10 days after end of the month and file GSTR-7.
The person deducting the tax after making payment shall furnish a certificate mentioning therein the contact Value, Rate of deduction, amount deducted, amount paid to appropriate government. The certificate shall be in Form GSTR-7A.
Section 51(4) provides that if certificate is not furnished with in 5 days of crediting amount to appropriate government then late fees of Rs. 100/- will be levied on deductor.
Maximum Cap of Late Fees is 5000/-
The deductor is required to furnish the return in form GSTR-7 and details of tax deducted disclosed in table 3 of GSTR -7.
Also following information will be declared by the deductor in GSTR-7.
|1||GSTN of the Deductee|
|2||Value on which TDS is to be Deducted|
|3||Amount of tax deducted at source|
Mechanism of TDS Credit:-
Refund of Tax Excees Paid:
Tax Deducted at Source V/S Collection of Tax at Source:-
|Sr.No||Description||Provision of TDS||Provision of TCS|
|1||Person Liable||Specified as Above||Electronic Commerce Operator|
|2||Rate||1% of Payment made or credited to suppliers of Taxable goods and/or Services||At Maximum of 1% of net value of Taxable supplies|
|3||Payment of Tax||By 10th of Next month||By 10th of Next month|
|4||Issuance of Certificate||With in 5 days of Deposition Tax||NA|
|5||Filing of Return||With in 10 days from the end of month||No return, But Statement as may be prescribed.|
|6||Credit to Supplier||Amount will be credited in Electronic cash ledger||Amount will be credited in Electronic cash ledger|