Although the moot issue that was discussed in the GST Council meeting held yesterday was resolving of cess shortfall issue. Though this issue still remains unresolved , a major decision has been taken by the GST Council in regard to approval of future roadmap of return filing under GST and certain changes in regard to filing of GSTR-3B and CMP-08.
It may be noted here that in its 39th Meeting held in March 2020, the Council had recommended an incremental approach to incorporate features of the new return system in the present familiar GSTR-1/3B scheme. Various enhancements have since been made available on the GST Common Portal. Now taking this further future roadmap has been approved in yesterday’s meet by GST Council.
Future roadmap of filing of GST returns approved:
With a view to further enhance Ease of Doing Business and improve the compliance experience, the Council has approved the future roadmap for return filing under GST. The thrust of the roadmap is timely filing of GSTR-1 returns (statement of outward supplies) by the suppliers.
The approved framework aims to simplify return filing and further reduce the taxpayer’s compliance burden in this regard significantly, such that the timely furnishing of details of outward supplies (GSTR-1) by a taxpayer and his suppliers would –
(i) allow him to view the ITC available in his electronic credit ledger from all sources i.e. domestic supplies, imports and payments on reverse charge etc. prior to the due date for payment of tax, and
(ii) enable the system to auto-populate return (GSTR-3B) through the data filed by the taxpayer and all his suppliers. In other words, the timely filing of GSTR-1 statement alone would be sufficient as the return in FORM GSTR-3B would get auto prepared on the common portal.
Decision in regard to roadmap by GST Council:
The Council recommended / decided the following:
a. Preponing of filing of quarterly GSTR-1
Due date of furnishing quarterly GSTR-1 by quarterly taxpayers to be revised to 13th of the month succeeding the quarter w.e.f. 01.1.2021. It may be noted here that current due date of filing of quarterly GSTR-1 is end of the month succeeding the quarter.
b. Roadmap for auto-generation of GSTR-3B from GSTR-1s by:
i. Auto-population of liability from own GSTR-1 w.e.f. 01.01.2021; and
ii. Auto-population of input tax credit from suppliers’ GSTR-1s through the newly developed facility in FORM GSTR-2B for monthly filers w.e.f. 01.01.2021 and for quarterly filers w.e.f. 01.04.2021;.
c. Compulsory filing of GSTR-1 before GSTR-3B
In order to ensure auto population of ITC and liability in GSTR 3B as detailed above, FORM GSTR 1 would be mandatorily required to be filed before FORM GSTR3B w.e.f. 01.04.2021.
d. GSTR-1/3B to be made default return filing system
The present GSTR-1/3B return filing system to be extended till 31.03.2021 and the GST laws to be amended to make the GSTR-1/3B return filing system as the default return filing system.
Filing of quarterly GSTR-3B returns:
Currently GSTR-1 is filed on monthly and quarterly basis based on turnover. However GSTR-3B in all cases are filed on monthly basis. The GST Council has as a further step towards reducing the compliance burden particularly on the small taxpayers having aggregate annual turnover < Rs. 5 cr., will allow filing of GSTR-3B on a quarterly basis with monthly payments by such taxpayers to be implemented w.e.f. 01.01.2021.
Such quarterly taxpayers would, for the first two months of the quarter, have an option to pay 35% of the net cash tax liability of the last quarter using an auto generated challan.
Filing of Nil CMP-08 return through SMS
The GST Council has approved amendment to the CGST Rules which inter-alia includes provision for furnishing of Nil FORM CMP-08 through SMS. This is in line with such facility already accorded for filing of GSTR-1 and GSTR-3B.
It may be noted here that a composition dealer is required to file Form CMP-08, which is a special statement-cum-challan to declare the details or summary of his/her self-assessed tax payable for a given quarter. It also acts as a challan for making payment of tax. A composition dealer is a dealer who has been registered under the composition scheme laid down for both supply of goods and services under Section 10 of the CGST Act, 2017.
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Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.
