Comprehensive Guide to the GST Filing Process in India

Hi, This is Ravi Kumar, and today, I will let you know about the GST, Navigating the complexities of the Goods and Services Tax (GST) system in India can be challenging for businesses of all sizes. Since its introduction in July 2017, GST has streamlined the country’s indirect tax structure, merging multiple taxes into a unified system. Despite its simplification of the tax landscape, the process of GST compliance-from registration to filing requires careful attention to detail. This blog aims to demystify the GST filing process, providing a clear, step-by-step guide to help you manage your GST obligations effectively and avoid potential pitfalls.

What is GST?

The Goods and Services Tax (GST) is a unified, multi-stage, and comprehensive tax levied on the supply of goods and services in India. Ensuring compliance with GST regulations is crucial for businesses. This tutorial provides a detailed step-by-step guide to the GST filing process in India.

GST Registration

Step 1: Determine Eligibility

a. Businesses with an annual turnover exceeding the prescribed limit (₹20 lakhs for most states, ₹10 lakhs for special category states) must register for GST.
b. Voluntary registration is also allowed.

Step 2: Apply for GSTIN

a. Visit the GST portal (www.gst.gov.in).
b. Complete the application by providing the necessary details and documents.
c. Upon approval, you will receive a unique Goods and Services Tax Identification Number (GSTIN).

Maintaining Records

Step 3: Keep Accurate Records

a. Maintain detailed records of all business transactions, including sales, purchases, and expenses.
b. Ensure invoices are GST-compliant, containing the GSTIN of the supplier and recipient, HSN code for goods or SAC code for services, and applicable tax rates.

Step 4: Invoice Management

a. Issue invoices for all taxable goods and services.
b. Retain copies of all invoices issued and received.

Filing GST Returns

Step 5: Understand Types of GST Returns

GSTR-1: Outward supplies of goods or services.

Due Date: 11th of the following month.

GSTR-2A: Auto-drafted return based on outward supplies furnished by suppliers.

GSTR-3B: Summary return for declaring inward and outward supplies and tax payment.

Due Date: 20th of the following month.

GSTR-4: Quarterly return for composition scheme taxpayers.

Due Date: 18th of the month following the quarter.

GSTR-9: Annual return summarizing all supplies made and received during the year.

Due Date: 31st December of the next financial year.

Step 6: File Returns on the GST Portal

1. Log in to the GST portal.
2. Navigate to the ‘Returns Dashboard’.
3. Select the applicable return form (e.g., GSTR-1, GSTR-3B).
4. Fill in the required details.
5. Submit the return form.

Payment of Tax

Step 7: Calculate Tax Liability

Compute your tax liability based on outward and inward supplies.

Step 8: Make the Payment

a. Payments can be made through the GST portal using net banking, credit/debit card, or over-the-counter methods for payments up to a specified limit.
b. Ensure payment is completed before filing the return to avoid penalties.

Claiming Input Tax Credit (ITC)

Step 9: Verify Eligibility for ITC

a. Ensure the goods and services are used for business purposes.
b. Ensure the supplier has uploaded the invoice and paid the corresponding GST.

Step 10: Claim ITC

a. Claim ITC in the relevant return form (e.g., GSTR-3B).
b. Maintain records of all invoices and supporting documents.

Filing Amendments

Step 11: Correcting Errors

a. If errors are found in the submitted returns, make amendments in subsequent returns.
b. Ensure accurate reporting to minimize discrepancies.

Generating E-Way Bills

Step 12: Understand E-Way Bill Requirements

E-way bills are required for transporting goods worth more than ₹50,000.

Step 13: Generate E-Way Bill

a. Visit the E-Way Bill portal (ewaybillgst.gov.in).
b. Provide necessary details, including GSTIN, invoice number, and goods details.
c. Generate and print the E-Way Bill.

Compliance and Penalties

Step 14: Timely Filing and Payment

File returns and make payments on time to avoid interest and penalties.

Step 15: Reconciliation

Regularly reconcile books of accounts with the returns filed and data on the GST portal to ensure accuracy.

Step 16: Prepare for Audits

a. Certain taxpayers are required to get their accounts audited by a chartered accountant.
b. Submit a reconciliation statement in GSTR-9C, if applicable.

Additional Tips

Regular Updates: Stay updated with the latest notifications and amendments in GST laws by regularly visiting the CBIC website (cbic-gst.gov.in).
Software Tools: Utilize GST-compliant accounting software to automate and streamline the filing process.

Frequently Asked Questions (FAQs) on the GST Filing Process in India

1. What is GST?
   Answer: GST (Goods and Services Tax) is a comprehensive, multi-stage, destination-based tax that is levied on every value addition. It is applicable to the supply of goods and services and has replaced many indirect taxes previously levied by the central and state governments.
2. Who needs to register for GST?
   Answer: Businesses with an annual turnover exceeding ₹20 lakhs (₹10 lakhs for special category states) are required to register for GST. Certain businesses, like those involved in inter-state supply or e-commerce, must register regardless of turnover.
3. What is a GSTIN?
   Answer: GSTIN (Goods and Services Tax Identification Number) is a unique 15-digit identifier assigned to each GST-registered business. It is used for all GST-related processes and filings.
4. What are the different types of GST returns?
   Answer: The main types of GST returns include:

GSTR-1: Outward supplies of goods or services (monthly/quarterly).
GSTR-2B: Auto-drafted return based on outward supplies furnished by suppliers.
GSTR-3B: Summary return for inward and outward supplies and tax payment (monthly).
GSTR-4: Quarterly return for composition scheme taxpayers.
GSTR-9: Annual return summarizing all supplies made and received during the year.

5. What is the due date for filing GSTR-3B?
   Answer: The due date for filing GSTR-3B is the 20th of the following month.
6. How do I file my GST returns?
   Answer: GST returns can be filed online through the GST portal. You need to log in with your GSTIN, navigate to the ‘Returns Dashboard’, select the applicable return form, fill in the required details, and submit the return.
7. How is the GST payment made?
   Answer: GST payments can be made through the GST portal using net banking, credit/debit card, or over-the-counter methods for payments up to a specified limit. Ensure the payment is completed before filing the return to avoid penalties.
8. What is Input Tax Credit (ITC)?
   Answer: ITC allows businesses to reduce the tax they have paid on purchases from the tax they have collected on sales. To claim ITC, the goods and services must be used for business purposes, and the supplier must have uploaded the invoice and paid the corresponding GST.
9. Can I correct errors in my GST returns?
   Answer: Yes, errors in submitted returns can be corrected by making amendments in subsequent returns. Ensure accurate reporting to minimize discrepancies.
10. What is an e-way bill?
    Answer: An e-way bill is a document required for the transportation of goods worth more than ₹50,000. It is generated online through the E-Way Bill portal and must be carried by the person in charge of the conveyance.
11. What are the penalties for late GST filing?
    Answer: Penalties for late filing of GST returns include a late fee and interest on the outstanding tax amount. The late fee is ₹50 per day (₹25 each for CGST and SGST) and ₹20 per day for nil returns (₹10 each for CGST and SGST).
12. How do I claim a refund under GST?
    Answer: To claim a refund under GST, you must file Form GST RFD-01 on the GST portal. The refund can be claimed for reasons such as excess tax payment, export of goods/services, or ITC accumulation.
13. What is GSTR-9C?
    Answer: GSTR-9C is a reconciliation statement to be filed by taxpayers whose annual turnover exceeds ₹2 crores. It is a statement reconciling the value declared in annual returns with the audited annual financial statement, certified by a chartered accountant or cost accountant.
14. Are there any exemptions under GST?
    Answer: Yes, certain goods and services are exempt from GST, such as unbranded food grains, milk, education, and healthcare services. Detailed lists of exempt goods and services are provided under various notifications issued by the government.
15. How can I stay updated with the latest GST notifications and amendments?
    Answer: Stay updated with the latest GST notifications and amendments by regularly visiting the CBIC (Central Board of Indirect Taxes and Customs) website at www.cbic-gst.gov.in. You can also subscribe to newsletters and updates from GST practitioners or tax consultants.

These FAQs cover the essential aspects of the GST filing process and address common queries to help businesses comply with GST regulations effectively.

By following this comprehensive guide, businesses can ensure they remain compliant with GST regulations and avoid potential penalties. Proper understanding and timely execution of these steps are essential for smooth GST management.

Thanks,