IT Dept Release Draft Rules Under GST Tax Filings; Now, Tax Payers May Need To File Monthly Returns
Income Tax Department has released the first draft of rules pertaining to tax filing under the new GST regime.
Rules pertaining to invoice and payments, registrations, show-cause notices, procedures, and documents related to tax filing under the new Goods and Services Tax environment has been released at an interesting juncture: On September 30th, Centre and State Govt. representatives will have a high level meeting to discuss the regulations.
Hence, these new tax filing rules which would be followed by registered companies would form the backdrop of the meeting.
One of the most interesting rule applied under GST is monthly tax filing by tax-payers. As of now, Service tax, VAT filings are done quarterly, and Income Tax filing is done on an annual basis. However, businesses whose annual revenues is more than Rs 50 lakh can opt for Compounding Scheme, wherein filing has to be done quarterly.
Major highlights from the first draft of IT filing rules under GST:
– No fees for filing application for registration of a new/existing business
– Total of 26 forms have been floated, which includes show-cause notices for cancellation of registration, order for amending registration, and more
– Before registration of a new business, PAN would have to be verified from Tax Portal, and mobile number, email via OTP
– GSTN Portal and Facilitation Centres would be now used for application of new registration
– New entities formed for monitoring tax payments: Electronic Tax Liability Register, E-Register for Cash Payments, E-Register for Credits.
– Tax can be paid via NEFT, Internet Banking, Credit/Debit card and over the counter payment can be only upto Rs 10,000
– A unique ID would be generated for every IT transaction, and would be synchronized with Tax Liability Register
– For Supply of Services, a period of 30-days have been mentioned, before which the invoice should be generated. No time limit for Supply for Goods have been mentioned
– A new draft format for Electronic Reference Number of Invoice proposed
– In case non-taxable goods or services are being supplied, then under Composition Scheme, a Bill of Supply needs to be issued by the supplier
– Transporter of Goods need not carry copy of the invoice, only if the supplier has uploaded the details of invoice on the GST portal, and a unique Invoice Reference Number has been generated. This will reduce paper-work and ensure smooth passing of goods
– Tax officer needs to process application of refunds within 15 days of the claim being filed
– In case a tax-payer has good compliance record and no tax evasion offense in the last 5 years, then tax refunds process would be completed in 7 days
Industry veterans are surprised over the swiftness with which IT Dept. released the first draft. Considering greater emphasis has been given on electronic mode of payments, and reduced the burden on cash, overall, there is positive outlook towards the new rules for filing tax returns under GST.
The only concern coming in from large corporations is the major overhaul of their tax filing structure required for meeting GST’s new regulations. After the September 30th meeting, these new rules and regulations would be discussed and finalized by the States and Centre representatives.
We will keep you updated as more details come in.
