Through this article let's have a look on how the compliance under GST will be done for the first two months i.e. July, 2017 and August, 2017.
The Government of India has formed a Special purpose Vehicle Known as Goods and Services Tax Network to set-up the entire IT system which will support 80 lakh taxpayers in filing 320 Billion Invoices per month. The Invoices details are required to be filed Rate-wise at Line item level
Three monthly returns are to be created and filed by all regular taxable person:
a. Return of Outward Supplies (GSTR-1),
b. Return of Inward Supplies (GSTR-2) and
c. Monthly return (GSTR-3);
Out of above 3 returns, GSTR-1 need to be created by uploading the Outward Supplies Invoices while the other 2 returns i.e. GSTR-2 will be Automatically Generated for the taxpayer response on purchases, GSTR-3 need to filed as a Summary of Tax liability, Input tax Credit , Outward and Inward supplies. All three returns are to be signed and filed.
Setting up IT infrastructure to support this biggest tax reform is a mammoth task, and this can't be available immediately. The extending of dates by Income tax department for Income Tax filings due to system downtime is quite prevalent. So due to non-availability of proper Infrastructure and APIs there has been a delay in implementation of the specified forms & process mentioned above under GST as well. It's not that GSTN is behind the schedule but the volume and complexity is such huge that it will involve some more time for the smooth implementation.
Though the system is not ready as per expectations but at the same time the government can't afford to lose the Indirect tax collection of lakhs of crores, hence in order to collect revenue from Taxpayers for the First & Second month of GST regime i.e. July 2017 and August 2017 respectively, the Government has come-up with a Simplified Return Format called Form 3B.
In addition to creation and Filing of GSTR-3B, the GSTR-1, GSTR-2 & GSTR-3 for July, 2017 and August, 2017 shall also be required to be filed in the month of September, 2017 as it is expected that GSTN system will be ready by then to support the Normal filing process; refer Notification for more details:http://www.cbec.gov.in/resources//htdocs-cbec/press-release/press-note-on-return-filing.pdf
GSTR 3B is a Simplified form in which Taxpayer will report summary details of Outward and Inward supplies along with other details, the below categorized information need to be readily available with every tax payer or tax professional before filling the details at GST portal.
Here are the 10 important pointers to create and file GSTR 3B for the month of July, 2017 and August, 2017:
1. Outward Supplies: (Table 3.1)
a. Taxable (Taxable Value and All Tax Amounts including Cess)
b. Zero Rates (Taxable Value and Integrated Tax Amount in Cess)
c. Nil Rated and Exempted (Taxable Value)
d. Non-GST (Value as per other laws- Taxable Value)
Out of Outward Supplies as per 1a. , The Inter-State Supplies made to: (Table 3.2);
(i) Unregistered Persons (Taxable Value and Integrated Tax)
(ii) Composition Taxable Persons (Taxable Value and Integrated Tax)
(iii) UIN holders like WHO, Embassies etc. (Taxable Value and Integrated Tax)
Shall be reported POS wise.
2. Inward Supplies: (Table 3.1 and Table 5)
a. Reverse Charge Inward Supplies (Taxable Value and All Tax Amounts including Cess) (Table 3.1)
b. From a supplier under composition scheme, Exempt and Nil rated (Invoice Value) and (Table 5); the total value of the purchase of inputs from a composition taxable person or services received have to be bifurcated separately for intrastate and interstate.
c. Non GST supply (Invoice Value) (Table 5); the total value of the purchase of inputs that are nil rated or exempted inputs have to be bifurcated separately for intrastate and interstate.
3. Input Tax Credit on : (Table 4; 4A)
a. Import of goods (Input Tax Credit)
b. Import of services (Input Tax Credit)
c. Inward supplies liable to reverse charge (other than 2a. & 2b. above) (Input Tax Credit)
d. Inward supplies from ISD (Input Tax Credit)
e. All other ITC (Input Tax Credit)
No requirement of reporting Taxable or Invoice value for Inward supplies for Input Tax credit except as mentioned in Point 2 above.
4. Input Tax credit reversal : (Table 4; 4B)
a. As per rules 42 & 43 of CGST Rules (Input Tax Credit reversal)
b. Others (Input Tax Credit reversal)
5. Ineligible Input Tax Credit: (Table 4; 4D)
a. As per section 17(5) (Input Tax Credit- Not availed due to ineligibility)
b. Others (Input Tax Credit- Not availed due to ineligibility)
Example: ITC on the supply of goods or service by a fitness club or health centre.
6. Interest and Late Fee (Table 5.1)
a. Compute the interest liability manually, if any due to delay in filing of return or declaration of July invoices in August return.
b. Late Fee will be automatically calculated by GST portal
7. Table 6: Once the details in all the required tables of Form 3B are filled, user need to click on Save GSTR3B. Post that the Net liability/Credit will be computed and Table 6 will be enabled for an offset of the tax liabilities as per Cross utilization rules with the Input Tax Credit balance and Cash balances under respective major-minor Tax heads
8. Table 7: TCS and TDS tables are available in GSTR 3B but shall be disabled for the time being till registrations for Deductors and E-commerce operators gets started, so no details are required for the same
9. Once the Return is Saved and Payment is done the Taxpayer can click on Submit
10. On Submit the return details will get freeze and Taxpayer need to sign & file using DSC or EVC.
1. Value of Taxable Supplies = Value of Invoices + Value of Debit Notes -Value of Credit notes + Value of Advances received for which invoices have not been issued in the same month - Value of Advances adjusted against invoices
2. Every taxable person under GST needs to calculate the tax liability under the different heads i.e. Integrated Tax, Central tax, State Tax/UT Tax, and Cess. Details of ITC available under different heads used for paying the tax liability.
3. Amendment in any details to be adjusted and not shown separately. 20th August is the last date to file GSTR-3B for the month of July, send your invoices and we will do the rest for you.