Table of contents:

• Overview
• Types of Returns
• Who shoud file the returns?
• Documents Required
• Steps to file return
• Due Dates
• Penalties on delayed returns
• How to check return status
• Challenges & Solutions
• Recent Updates
• Conclusion

A GST return is a mandatory document that taxpayers registered under the Goods and Services Tax (GST) regime in India must file. It includes details of their income, purchases, sales, and taxes collected or paid. Filing GST returns is crucial to maintaining compliance with the GST laws and ensuring seamless tax credits.

GST return filing ensures transparency in tax transactions and allows businesses to claim Input Tax Credit (ITC). Non-compliance or delayed filing can result in penalties, disrupted ITC claims, and strained business operations.

The filing process involves uploading accurate details, submitting tax liabilities, and verifying the data, either online or offline.

Types of GST Returns

The GST regime mandates various types of returns, tailored to meet the needs of different taxpayer categories. Here’s a brief overview taken from the separately published article:

These returns ensure compliance, transparency, and a seamless tax credit system, making them essential for every GST-registered taxpayer.

Who Should File GST Returns?

Filing GST returns is mandatory for various taxpayer categories to ensure compliance. Here’s an overview:

• Regular Taxpayers: Businesses registered under GST must file returns monthly or quarterly, depending on their turnover and filing preference. These filings include GSTR-1 for outward supplies and GSTR-3B for tax summary and payment.
• Composition Scheme Taxpayers: Small businesses opting for the composition scheme pay GST at a fixed rate and file GSTR-4 annually. Additionally, they submit CMP-08 quarterly for tax payment details.
• Input Service Distributors (ISD): Entities distributing Input Tax Credit (ITC) to their branches or divisions must file GST returns detailing ITC allocation.
• Non-resident Taxable Persons: Foreign businesses or individuals supplying goods or services in India must file GSTR-5 to report sales, purchases, and tax payments.
• E-Commerce Operators: Online platforms like Amazon and Flipkart are required to file GSTR-8, which reports tax collected at source (TCS) on behalf of sellers using their platforms.

Documents Required for GST Return Filing

To ensure smooth GST return filing, taxpayers must have the following documents ready:

• Invoices for Sales and Purchases:

• • Details of outward supplies (sales invoices).
  • Details of inward supplies (purchase invoices).

• Debit and Credit Notes: Records of adjustments for returns, refunds, or corrections.
• Tax Payment Challans: Proof of GST payments made, including any interest or late fees.
• ITC-Related Documents: Documents supporting Input Tax Credit claims, such as supplier invoices and purchase receipts.
• Export and Import Data: Bills of entry for imports and shipping bills for exports.
• Bank Statements: For transactions related to GST payments and refunds.
• Other Business Records: Relevant records like e-way bills, reconciled GSTR-2A and GSTR-2B, and e-invoice details, if applicable.

GST Return Filing Process

Filing a return would require registration as a taxpayer on the GST portal. You must be handy with GSTIN number and login details for the filing process.

1. Access the GST Portal: Visit the official GST portal and log in using your credentials.
2. Navigate to Services: On the dashboard, click on the ‘Services‘ menu to proceed.
3. Select Returns Dashboard: Choose the ‘Returns Dashboard’ option and select the relevant financial year and filing period from the drop-down menu.
4. Choose the Return Form: Click on the return form you want to file, then select ‘Prepare Online.’
5. Fill in Details: Enter all necessary data, such as sales, purchases, tax payable, and ITC, ensuring accuracy.
6. Save Your Progress: After filling in all details, click the ‘Save’ button. A confirmation message will appear.
7. Submit the Return: Scroll down and click ‘Submit.’ The return status will update to ‘Submitted.’
8. Make Payments: Go to the ‘Payment of Tax’ section, check your cash and credit balance, and offset liabilities using ITC or cash.
9. Offset Tax Liability: Select the tax amount to offset from available credits and click ‘Offset Liability.’ Confirm the payment.
10. Final Submission: Click ‘File Form’ and choose between DSC (Digital Signature Certificate) or EVC (Electronic Verification Code) to complete the process.

Once done, you’ll receive an acknowledgment for your filed return. Always keep this for your records.

Due Dates and Penalties

Penalties for Late Filing:

• Late fee: ₹50/day for regular returns and ₹20/day for nil returns.
• Interest: 18% per annum on outstanding tax liability.

For instance, a delay in filing GSTR-3B by 10 days incurs a ₹500 penalty (₹50 × 10) plus interest.

How to check return status

The GST portal provides businesses with convenient options to check the status of their GST returns using the ARN (Acknowledgment Reference Number), a date range, or the status filter. Once a return is filed, an ARN is generated, which serves as a reference for tracking the return’s status.

If the ARN is not readily available, businesses can opt to search using the date range during which the return was submitted. Alternatively, the status filter allows users to directly access submitted and valid returns, ensuring flexibility in tracking.

To assist businesses further, we have created a step-by-step guide on how to check the GST return status using the ARN.

Common Challenges and Solutions

Taxpayers often face challenges while filing GST returns. Below are common problems and solutions:

1. Errors in Data Entry: Incorrect invoice details can disrupt ITC claims.
   • Solution: Double-check data before submission.
2. Mismatch in GSTR-2A and GSTR-3B: Differences between auto-populated and filed returns lead to compliance issues.
   • Solution: Reconcile data monthly.
3. Technical Glitches: Portal downtime can cause delays.
4. Solution: File returns well before the due date.

4 common mistakes to avoid while filing GST return

Recent Updates and Amendments

The GST Council has implemented several updates to streamline filing procedures and enhance compliance:

• Auto-Populated Returns: Introduced on October 1, 2020, this feature reduces manual entry errors by auto-generating data for certain returns.
• E-Invoicing Expansion: Effective from April 1, 2021, mandatory e-invoicing was extended to businesses with turnover exceeding ₹50 crore, ensuring real-time invoice reporting.
• Simplified GSTR-9: On December 31, 2020, the annual return form GSTR-9 was simplified for small taxpayers, reducing the number of fields to ease compliance.
• Amendments in GSTR-3B: As of August 1, 2020, taxpayers can amend errors in GSTR-3B for prior periods, allowing corrections in subsequent returns.
• Introduction of GSTR-2B: Launched on August 29, 2020, GSTR-2B is a static monthly statement aiding taxpayers in reconciling Input Tax Credit (ITC) with purchase records.
• QRMP Scheme: Implemented on January 1, 2021, the Quarterly Return Filing and Monthly Payment (QRMP) scheme allows taxpayers with turnover up to ₹5 crore to file returns quarterly and make tax payments monthly.
• Late Fee Rationalization: Announced on May 28, 2021, the GST Council rationalized late fees for delayed return filing, providing relief to taxpayers and encouraging timely compliance.

These measures reflect the Council’s commitment to making GST compliance more efficient and taxpayer-friendly.

Conclusion

Accurate and timely GST return filing is crucial for maintaining compliance, ensuring seamless tax credit claims, and avoiding penalties. Understanding the types of returns, filing processes, and recent updates empowers businesses to stay compliant with evolving regulations. Leveraging tools, reconciling data, and staying informed about due dates can simplify the process and enhance accuracy.

The GST framework, with its continuous improvements, supports businesses in managing taxes efficiently while promoting transparency. By following best practices and utilizing the resources available, taxpayers can navigate GST filing with confidence and focus on growing their businesses.

Disclaimer:
The information provided in this blog is for general informational purposes only and does not constitute professional advice or recommendations. While every effort has been made to ensure the accuracy and reliability of the information, readers are advised to verify details independently and consult a professional for specific guidance related to GST return filing or compliance. The author and publisher disclaim any liability for decisions made based on this content.

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Author: Anirban Sinha

A product manager with a writer’s heart, Anirban leverages his 6 years of experience to empower MSMEs in the business and technology sectors. His time at Tata nexarc honed his skills in crafting informative content tailored to MSME needs. Whether wielding words for business or developing innovative products for both Tata Nexarc and MSMEs, his passion for clear communication and a deep understanding of their challenges shine through.