Introduction
Filing GST returns is an essential aspect of GST compliance for ecommerce sellers. The GST returns provide information about the business’s sales, purchases, input tax credit, and tax liability for a specific period. GST filing involves submitting the details of the business’s sales, purchases, input tax credit, and tax liability for a specific period. Ecommerce sellers must file various types of GST returns, such as GSTR-1, GSTR-3B, and GSTR-9, depending on their turnover and registration type. This step-by-step guide is designed to help ecommerce sellers file their GST returns accurately and on time.
GST Filling Steps
Step 1: Collect Invoices and Documents
Ecommerce sellers must collect all the invoices, receipts, and other documents related to their sales, purchases, and expenses during the relevant period. The invoices and receipts must contain all the necessary details, such as the GSTIN of the supplier or recipient, the transaction value, and the tax amount.
Step 2: Prepare the Return
Once the invoices and documents are collected, ecommerce sellers must prepare the GST return for the relevant period. The GST return must be prepared accurately and include all the relevant details, such as the sales, purchases, input tax credit, and tax liability.
Step 3: File GSTR-1
GSTR-1 is a monthly or quarterly return filed by ecommerce sellers to provide details of their outward supplies. Ecommerce sellers must file GSTR-1 by the 11th of the next month for monthly filers or by the 13th of the next month for quarterly filers. The details to be provided in GSTR-1 include the invoice-wise details of the supplies made, the details of the recipients, and the tax liability.
Step 4: File GSTR-3B
GSTR-3B is a monthly return filed by ecommerce sellers to provide a summary of their sales, purchases, and input tax credit. Ecommerce sellers must file GSTR-3B by the 20th of the next month. The details to be provided in GSTR-3B include the total value of supplies made, the total value of purchases, the input tax credit claimed, and the tax liability.
Step 5: File GSTR-9
GSTR-9 is an annual return filed by ecommerce sellers to provide a summary of their sales, purchases, input tax credit, and tax liability for the financial year. Ecommerce sellers must file GSTR-9 by the 31st of December of the subsequent financial year. The details to be provided in GSTR-9 include the details of the supplies made, the details of the purchases, the input tax credit claimed, and the tax liability for the financial year.
Step 6: Verify and Submit the Returns
After preparing the returns, ecommerce sellers must verify and submit the returns on the GST portal (https://www.gst.gov.in/). The returns can be verified using a digital signature or an electronic verification code (EVC). The digital signature is used for signing the return electronically, while the EVC is generated through a one-time password (OTP) sent to the registered mobile number. The returns must be submitted on the GST portal by the due dates to avoid penalties and interest.
Step 7: Pay the Tax Liability
If there is any tax liability after adjusting the input tax credit, ecommerce sellers must pay the tax liability using the GST portal. The payment can be made through internet banking, credit card, or debit card. The tax liability must be paid by the due date to avoid penalties and interest.
Step 8: Reconciliation
Ecommerce sellers must reconcile their GST returns with their books of accounts and ensure that there are no discrepancies. Any discrepancies or errors must be rectified promptly to avoid penalties and legal action.
What happens if you do not file GST returns on time?
Not filing GST returns on time can have several consequences for businesses, including the following:
Late Fees
If a business fails to file its GST returns on time, it may be liable to pay a late fee of Rs. 50 per day for each return that is not filed. The maximum late fee is Rs. 5,000 per return.
Interest
If a business fails to pay the tax liability or file its GST returns on time, it may be liable to pay interest at the rate of 18% per annum. The interest is calculated on the outstanding tax liability from the due date till the date of payment.
Penalty
If a business fails to file its GST returns on time, it may be liable to pay a penalty of Rs. 10,000 or 10% of the tax due, whichever is higher. The penalty is levied for each return that is not filed.
Prosecution
If a business continues to default in filing its GST returns or paying the tax liability, the GST authorities may initiate prosecution proceedings against the business owner. The business owner may be liable to pay a fine and face imprisonment for up to three years.
Loss of Input Tax Credit
If a business fails to file its GST returns on time, it may lose the input tax credit on its purchases. Input tax credit is allowed only if the supplier has filed its GST returns and paid the tax liability on time. Therefore, if the supplier has not filed its returns or paid the tax liability, the recipient may not be able to claim the input tax credit.
Turnover Limits and Due Dates for Filing GST Returns in India
Turnover Limits for Filing GST Returns:
GSTR-1:
Monthly filing: Businesses with a turnover exceeding Rs. 1.5 crores in the previous financial year must file GSTR-1 monthly.
Quarterly filing: Businesses with a turnover up to Rs. 1.5 crores have the option to file GSTR-1 quarterly.
GSTR-3B:
Monthly filing: Businesses with a turnover exceeding Rs. 5 crores in the previous financial year must file GSTR-3B monthly.
Quarterly filing: Businesses with a turnover up to Rs. 5 crores can file GSTR-3B monthly or quarterly.
GSTR-4:
Quarterly filing: Businesses registered under the Composition Scheme must file GSTR-4 quarterly, regardless of their turnover. The composition scheme is available for businesses with a turnover up to Rs. 1.5 crores.
GSTR-9:
Annual filing: All businesses registered under GST must file GSTR-9 annually, regardless of their turnover. GSTR-9 provides a summary of the business’s sales, purchases, input tax credit, and tax liability for the financial year.
Due Dates for Filing GST Returns:
GSTR-1:
Monthly filing: By the 11th of the next month.
Quarterly filing: By the 13th of the next month.
GSTR-3B: By the 20th of the next month.
GSTR-4: By the 18th of the month following the end of the quarter.
GSTR-5: By the 20th of the next month.
GSTR-6: By the 13th of the next month.
GSTR-7: By the 10th of the next month.
GSTR-8: By the 10th of the next month.
GSTR-9: By the 31st of December of the subsequent financial year.
GSTR-10: Within three months of the date of cancellation for businesses whose registration has been canceled.
ConclusionÂ
Filing GST returns accurately and on time is crucial for ecommerce sellers in India. By following the step-by-step guide outlined in this blog, sellers can collect and prepare the necessary documents, file various types of GST returns, verify and submit returns on the GST portal, and reconcile their records. Non-compliance with GST filing deadlines can result in penalties, interest, and even prosecution. Therefore, it is essential for businesses to understand the turnover limits and due dates for each type of return to ensure compliance and avoid legal consequences. Prioritizing GST compliance helps maintain a good reputation and fosters trust with customers and stakeholders.