Relief in GST amidst Coronavirus (COVID19) Pandemic

Relief provided by the Government in GST amidst the Coronavirus (COVID19) Pandemic

As you all know, the current Coronavirus Pandemic has caused a huge turmoil in the economic sector of the whole world. And amidst this, our Govt. has taken a step of imposing a lockdown in the country. To enable the businesses to cope up with the regulatory compliance under GST, the Govt. has provided some relief measures vide 7 notifications issued on 3^rd April, 2020.

Coming to GST Returns, the govt. has waived the late fees on filing of the GSTR 1 for monthly as well as quarterly taxpayers. The relief has been provided for the GSTR 1 for the months of March, April and May 2020 for monthly filing taxpayers and for January-March 2020 quarter for quarterly filing taxpayers. The late fees on the said returns are waived off until 30^th June, 2020. This is laid down under the Notification No. 33 of 2020 – Central Tax, issued by CBIC on 3^rd April. For clarification, please refer to Table 1.

Table 1: GSTR 1 DATES

The late fees for GSTR 3B return has also been waived off by the govt. This waiver has been made up to different dates factored by turnover of the taxpayer and the month for which the return is being filed as explained in the Table 2. For taxpayers having an aggregate turnover of More than Rs. 5 Crore in the previous financial year, the late fees for GSTR 3B for the months of February, March and April 2020 has been waived till 24^th June, 2020. That means these taxpayers need to file the returns till 24^th June 2020 to avoid late fees.

For taxpayers having an aggregate turnover of More than Rs. 1.5 Crore but less than Rs. 5 Cr. in the previous financial year, the late fees for GSTR 3B for the months of February and March has been waived till 29^th June, 2020 and the late fees for GSTR 3B for the month of April has been waived till 30^th June, 2020. For taxpayers having an aggregate turnover of Less than Rs. 1.5 Cr. in the previous financial year, the late fees for GSTR 3B for the month of February 2020 is waived till 30^th June, 2020, for the month of March, it has been waived till 3^rd July, 2020 and for the month of April, it has been waived till 06^th July, 2020. This is laid down under the Notification No. 32 of 2020 – Central Tax, issued by CBIC on 3^rd April. For clarification, please refer to Table 2.

Table 2: GSTR 3B DATES – FEB. – APR. 2020

The Govt, recently introduced a staggered system of filing GSTR 3B so as to curtail the load upon the GST Portal. In that system, the dates were divided as per the state in which the taxpayer is registered under GST. Following the same staggered system, the late fees on filing of GSTR 3B for the month of May has been extended from its original dates to 27^th June 2020 for taxpayers having a turnover of more than Rs. 5 Crore in the previous financial year. For taxpayers having turnover of less than Rs. 5Crore in the previous financial year, the dates have been decided as 29^th June 2020 and 30^th June 2020 as per the states of registration of the taxpayers as shown in the Table 3. This is laid down under the Notification No. 36 of 2020 – Central Tax, issued by CBIC on 3^rd April.

Table 3: GSTR 3B DATES – MAY 2020

The Govt. also provide some relief in the interest concerning the late payment of tax, though it is not waived completely. For the taxpayers having an aggregate turnover of above Rs. 5 Crore, the interest on late payment of tax is waived only for 15 days of the old date of filing of the GSTR 3B for that month, and after that, interest at a reduced 9% shall apply on such late payment of tax till 24^th June, 2020.

For e.g., If a Company having aggregate turnover of Rs. 6 Crores, files its GSTR 3B for the month of March within its old last date i.e. 20^th April 2020 or even within 15 days of its old last date i.e. 5^th May 2020, no interest shall be chargeable upon payment of such tax, but if the company files the said return after 5^th May and by 24^th June 2020, a reduced rate of interest of 9% per annum shall be applicable. And if the company files its said return after 24^th June, the normal rate of interest of 18% p.a. shall be applicable.

Coming on to taxpayers with turnover below Rs. 5 Crore and above Rs. 1.5 Crore, the interest on late payment of tax and filing of GSTR 3B is waived for the months of February 2020 and March 2020 till 29^th June 2020 and for the month of April 2020 till 30^th June 2020.

For taxpayers having turnover below Rs. 1.5 Crore, the interest on late payment of tax and filing of GSTR 3B is waived for the month of February 2020 till 30^th June, 2020, March 2020 till 3^rd July 2020 and for the month of April 2020 till 6^th July 2020 as shown in Table 4.

This is laid down under the Notification No. 31 of 2020 – Central Tax, issued by CBIC on 3^rd April, 2020. If this seems a little confusing, I’ll suggest taking the help of the updated GST calendar, available for download on the link provided here (https://www.amlegal.online/downloads) , it will help to understand it better.

Table 4: GSTR 3B – INTEREST WAIVER

For Composition taxpayers, the last date to file CMP 08, which is the quarterly return, for the quarter ending March 2020, is extended to 7^th July, 2020 and the last date to file GSTR 4 which is to be filed annually, for the year ending 31^st March 2020 is extended to 15^th July 2020 as shown in Table 5. This is laid down under the Notification No. 34 of 2020 – Central Tax.

Table 5: COMPOSITION TAXPAYERS – DATE EXTENSION

Also, there have been some amendments in the provisions of the CGST Rules 2017 vide Notification No. 30 of 2020 – Central Tax. As per this, the last date to opt for composition scheme by regular taxpayers is extended to 30^th June, 2020 and the resultant last date to file the ITC 03 return is 31^st July 2020.

As you all know, the Govt. introduced a restriction of 10% on provisional input tax credit taken by taxpayers in GSTR 3B which is over and above what is reflected GSTR 2A. The said provision is henceforth relaxed a little bit due to the pandemic, and now, the effect of the said provision shall be cumulatively taken in the GSTR 3B of September 2020 for the months of February till August.

Apart from these, the govt. has also provided a blanket extension in the provisions of the CGST Act including extending the limitations for orders, appeals, revisions under the Act. The said blanket extension has some exceptions concerning some provisions of the Act as mentioned in the relevant notification. This is laid down under the Notification No. 35 of 2020 – Central Tax, issued by CBIC on 3^rd April, 2020.

These were all the changes brought by the Govt. to ease the compliance upon taxpayers under GST.

(Author- Manu Gupta | BBA; LLM (Taxation) | Corporate & Taxation Partner | Amethyst Legal | Delhi)