Important changes related to QRMP Scheme implemented on the GST Portal for the taxpayers

Important changes related to QRMP Scheme implemented on the GST Portal for the taxpayers

The changes announced are really a welcome move as it reduces the burden of QRMP Taxpayers for consolidating the data and the filing the returns.

Few important changes related to QRMP Scheme implemented on the GST Portal for the taxpayers are as given below:

A.Auto population of GSTR-3B liability from IFF and Form GSTR 1 : A taxpayer under QRMP Scheme can declare their liability through optional IFF for Month 1 and Month 2 of a quarter & Form GSTR-1 for Month 3 of that quarter. Declaration of liability in these forms would now be auto-populated in their Form GSTR-3B (Quarterly) for that quarter, based on their filed Form GSTR-1 and IFF. These fields are editable and in case their values are revised upwards or downwards, the edited field(s) would be highlighted in red colour and a warning message will be displayed to the taxpayer. However, the system would not prevent taxpayer from filing of Form GSTR-3B with edited values.

B.Nil filing of Form GSTR-1 (Quarterly) through SMS : Nil filing of Form GSTR-1 (Qtrly) through SMS has been enabled for taxpayers under QRMP Scheme. They can now file it by sending a message in specified format to 14409. The format of the message is < NIL > space < Return Type (R1) > space< GSTIN > space < Return Period (mmyyyy) > .
Example: NIL R1 07XXXXX1234H8Z6 062020 (where return period must be last month of the quarter)

However, NIL filing through SMS can’t be done in following scenarios:
•If IFF for Month 1 or 2 of a quarter is in Submitted stage, but not Filed.
•If invoices are Saved in IFF for Month 1 or 2 of a quarter, which was not submitted or filed by due date.

C.Impact of cancellation of registration on liability to file Form GSTR-1 : In case registration of a taxpayer under QRMP Scheme is cancelled, with effective date of cancellation being any date after 1st day of Month 1 of a quarter, they would be required to file Form GSTR-1 for the complete quarter, as the last applicable return. For example if the taxpayer’s registration is cancelled w.e.f. 1st of April, he/she is not required to file Form GSTR-1 for Apr-June quarter and Form GSTR-1 for Jan-Mar Quarter shall become the last applicable return. However, if the registration is cancelled on a later date during the quarter, the taxpayer would be required to file Form GSTR-1 for Apr-June quarter. In such cases the filing will become open on 1st of month following the month with cancellation date i.e. if cancellation has taken place on 20th May, Form GSTR-1 for Quarter Apr-June can be filed anytime on or after 1st of June.

We would like to advise a word of caution, please cross check the numbers auto populated as it help to identify any issues in auto population.

NIC Gepp-on Tool for e-invoice system with New Features

NIC is happy to release the application/tool, known as GePP-On, for entering invoices and generation of IRN.
This is a browser-desktop based application which can also be used on the mobile devices, without having
web application/portal. The application will internally talk to the e-Invoice APIs for all the functionalities.

This will be helpful for the taxpayers who have few invoices so that they can generate e-invoices
without going for any API integration. The application is designed with simple forms for entering the invoice
details. The application has all the features like : Generation of IRN, Cancellation of IRN, Generation
of EWB by IRN, Printing of e-Invoice with QR Code, creation of Recipient master and HSN master,
backup and restoration of his data etc. The application can also run in offline mode ie, when no internet
is available, the taxpayer can enter all the details of invoice and keep it ready. As and when the internet
is resumed, the invoice details can be submitted to the e-Invoice portal and IRNs can be generated.
Another important point is that all the data entered by the taxpayers such as invoice data, master data
are stored locally on the taxpayer’s system. The taxpayer can also backup and restore data on to another
system, if required.

Additionally, mobile apps are released for Android and iOS on the same lines as given above. The
taxpayer can download these on his mobile and use them accordingly.

There are around 9600 taxpayers who are already using NIC GePP-Tool for generation of IRN. The difference
between Gepp-Tool and GePP-On is that in the former, taxpayer enters the invoice details, generates JSON file
and uploads in the e-Invoice portal. Where as in the latter, the taxpayer can enter all the details and on click of a
button, IRN is generated. This will facilitate a large of number of small taxpayers in the coming days when the no.
of taxpayers is increased for e-invoicing.

Beta version of GePP-On is launched on the sandbox system for testing by the tax payers who are enabled for
e-invoice generation.

The tax payer can use the web login credentials to access this application.

Documentation can be accessed from here

After 15-20 days, it will be released on the production system.

Thank you,
NIC e-invoice Team

Major Changes in GST Portal

For providing better user experience and new features are being added on the GST portal from time to time by the GSTN. Some of the important feature added on the GSTN portal are listed below

  1. Same Jurisdictional Authority in case of an applicant files a new application where it is canceled previously.

Applicants who are applying for registration again, in the previous cases where their registration is canceled by the applicant himself or suo-moto, the new GST registration application filed will be assigned to the same jurisdictional officer who has canceled it.

2. Aadhar Authentication enabled on SPICe -AGILE Form on MCA Portal.

As part of ease of doing business, SPICe -AGILE Form is introduced where multiple registrations can be obtained in a single form by the MCA for the newly established companies. Now Aadhar Authentication is also enabled on the SPICe -AGILE Form.

3. RESET button enabled on GST Portal for Form GSTR-1/ IFF (Invoice Furnishing Facility.

Normal taxpayers, irrespective of their filing profile (quarterly or monthly), have now been provided with a RESET button on the GST Portal, in Form GSTR-1/IFF. This will enable them to delete the entire saved data for the specific return period but not yet submitted or filed their Form GSTR-1/IFF.

4. Reporting and payment of taxes in GSTR-5A

Now taxpayers registered under OIDAR Category can declare and pay interest and other amounts in GSTR-5A.

5. Filing of the refund application by the exporter of services for exports with payment of taxes on account of foreign exchange fluctuations.

The system earlier validated the refund amount claimed by the exporter of services (with payment of tax) against the proceeds realized (against exports, as submitted by the claimant in the Form of FIRC). If the value realized in the BRC/FIRC column was less than the refund amount claimed, such taxpayers could not file their refund application on GST Portal. This validation has now been removed, and the taxpayer will be able to file a refund application now in such cases (As the value realized in BRC/FIRC may fluctuate due to foreign exchange fluctuations, and net realization may be less than the refund amount).

6. Enabling Audit Functionalities on GST portal

Now taxpayers can view and see the department’s notices and reports related to audit under the tab “Additional Notices and Orders.”

Taxpayers can reply to the notices

Taxpayers can apply for an adjournment of or for extension of the audit date to the jurisdictional officer or Audit officer.

The taxpayer can accept/reject/pay the liabilities, discrepancy-wise, as outlined in the Notice for Discrepancies or Addl. Notice for Discrepancies (if any) or in Audit Report (Form GST ADT-02).

7. Changes in Search Tax Payer functionality

In the search taxpayer functionality, now the users can see the status of the Aadhar Authentication or e-KYC status of the searched GSTIN

GST Tip – 377

As per Notification No. 51/2017 – Central Tax , Last Date for Cancellation of Registration for Migrated Tax Payers has been extended from 31st Oct 2017 to 31st Dec 2017. For Cancellation of Registration, FORM GST REG-29 has to be filed.

Cancellation of Registration Extended to 30th Sep 2017

To address the concerns of taxpayers arising from Transition to the GST regime, the Government decides to extend the time limit for filing intimation for Composition Levy (filing of intimation FORM GST CMP-01) up to 16th August, 2017; The period of applying for Cancellation of Registration is being extended up to 30th September, 2017.

The Government is mindful of the concerns of tax payers, especially the small taxpayers, arising from transition to the GST regime from 1st of July, 2017.

With a view to ease the compliance burden of provisionally migrated small taxpayers opting to pay tax under the Composition scheme, it has been decided to extend the time limit for filing intimation for Composition levy (filing of intimation FORM GST CMP-01) up to 16th August, 2017.

Similarly, the taxpayers who were provisionally migrated by virtue of being registered under the existing laws, but who are no longer required to be registered under GST, the period of applying for Cancellation of Registration is being extended up to 30th September, 2017. Relevant notifications are being issued.

(Release ID :168858)

Demystifying Invoicing Under Model GST Law

Invoice is a document between the buyer and seller which confirms the sale / purchase of goods or services along with the details like item or nature of service, cost per unit, if any applicable taxes on the transaction, any incidental charges like freight, packing charges, etc., apart from the buyer and seller details. Invoice is to be serially numbered for tracking and reference purpose. If the transaction is being taken for a taxable good or service, then the invoice becomes a tax invoice. The tax invoice apart from having the above-mentioned details, it will also have the tax registration number of the buyer and seller along with the address under which jurisdiction the buyer and seller falls.

In the current tax regime in India we have the following invoices which are considered as tax invoice from taxation perspective Excise Invoice, VAT Invoice & Service Tax Invoice. All these invoices are also required to be numbered serially and the tax payer has to  inform the tax authorities the tax invoice numbering sequence being followed for the financial year.

Under GST also there is a requirement to issue tax invoice as per section 23 of the Model GST Law at the time of supply of goods or services as per Section 12 and Section 13 of the Model GST Law. Section 23 of the Model GST Law prescribes the information to be shown on the tax invoice in case of supply of goods

  • Description of the goods
  • Quantity of the goods being sold
  • Value of the goods being sold
  • CGST / SGST or IGST levied on the goods
  • And any other information as requested

The following information is to be shown in case of supply of services

  • Description of the service
  • Value of the service
  • CGST / SGST or IGST levied on the goods
  • And any other information as requested

If we dissect the Section 15 of the model GST Law (value of taxable supply) it says that all the amounts being collected or reimbursed from the buyer has to be included in the valuation of the taxable supply of goods / services. This means that all charges related to the transaction directly or indirectly have to be shown on the tax invoice. The charges or reimbursable expenditure on which the tax have to be levied are freight, insurance, packing charges, loading charges, unloading charges, special / specific charges being levied, subsidies if any, royalties or any other incidental charges have to be included in the tax base and these amounts are being paid by the buyer to the seller or being reimbursed by the buyer to pay to third parties.

THE JOINT COMMITTEE ON BUSINESS PROCESS FOR GST on Returns has given the tentative formats of the Returns to be filed under GST Regime once rolled out. If we review the GSTR 1 Report, monthly outward supplies report to be filed by the tax payer has the following information

  • Invoice – Number, Date, Value, HSN/SAC, Taxable Value
  • Tax Rate and Amounts – CGST / SGST / IGST
  • State of the buyer
  • Reverse Charge applicable for the transaction

Though the reports to be filed under GST are not yet notified, on interpreting the information given in the Model GST Law and the Business Process Reports for Returns we can conclude that the following information is to be shown on the tax invoice else reporting will become complex

  • Description of the goods / service
  • Quantity of the goods being sold – applicable only in case of supply of goods
  • Value of the goods / services
  • CGST / SGST or IGST levied on the goods
  • Invoice – Number, Date, Value, HSN/SAC, Taxable Value
  • Tax Rate and Amounts – CGST / SGST / IGST
  • State of the buyer
  • Reverse Charge applicable for the transaction
  • Free goods if any issued

We can also conclude that if goods or services being supplied are applicable or eligible under reverse charge, the same needs to be shown on the tax invoice stating that tax applicable is under the reverse charge and the tax amount should not be included in the invoice total. This is similar to the existing service tax provision for invoicing under reverse charge.

As per the valuation rules, if goods are being issued as sample or freebie on the purchase of any other goods, then GST has to be levied on such free good or freebie. It will be a business decision to collect the tax from the customer or absorb it as business expenditure. This is not applicable under VAT currently not it is getting extend to SGST or IGST under the new tax regime.

As per the Model GST Law, post to issue of a tax invoice for supply of goods or services, if there is any change in the price of goods / service or tax rates, a debit memo or credit memo can be issued for such cases and the debit / credit memo should have the reference of the original tax invoice. In GSTR – 1, the debit / credit memos have to be reported under table / section 8.

In case if the tax payer is supplying both taxable goods / services along with non-taxable goods / services, a separate bill has to be issued. This is similar to the existing VAT provisions where a non-vatable invoice has to be issued for sale of non-vatable goods. Now the same is getting extend to CGST and IGST under GST regime.

As in the current excise or VAT requirements there will not be likely a format being suggested by the GST Council and the tax payers can issue tax invoice based on their business need but have to ensure that all the required information is shown / printed on the tax invoice being issued under section 23 of the Model GST Law.

Malaysia which has implemented GST from 1st April 2015 have suggested some invoice formats also. It has also recommended that simplified tax invoice can be issued and on which input tax credit can be availed if the tax amount is not exceeding RM 30. As per Malaysian GST, under specific conditions simplified tax invoice can be issued and such invoices need not show the buyer details like in the case of regular tax invoice. In India, we do not see any such provisions as the Model GST Law has made it clear that input tax credit can be availed on supplier payment of GST Liability.

Some of the common issues which the trade and industry may face with rollout of GST on the Tax invoice front are

  1. Free Samples – as per the Model GST Law, the tax has to be levied on free samples also, this may impact the pharmaceutical industry where samples are given to Physicians for promotion. Now going forward GST has to be paid before the issue of samples. The pharmaceutical industry may have to absorb the same that means it impact their profitability. Same in case of consumer goods also where freebies are given on merchandise.
  2. Loading Charges – will there be a separate Service Accounting Code for loading and unloading charges, which are collected from the buyer. This is applicable in case of commodities like iron, steel, aluminum etc
  3. Insurance Charges – in some case where the goods are transported are high value, insurance is also part of such contracts / sales. The insurance charges may be collected from the recipient or the tax payer may pay himself. Whatever may be the case, does the tax payer has to levy GST on the insurance premium and also mention in his registration form “Insurance” also as his business?
  4. Packing charges – in some cases, the customers may ask for special packing based on their business requirements, in such cases also GST is to be levied on packing charges. As such packing charges may not be having a separate HSN code in few cases like material being shipped in gunny bags / jute bags, in such cases what will be the HSN code?

Another change from the existing business process

  1. In the case of purchase of goods or services from non-registred tax payers, the reverse charge is applicable and basing on the rules provided in Model GST Law, the time of supply for the reverse charge is either accounting or creation of receipt or payment of supplier whichever is earlier. At this point, a tax invoice is also required to be issued. Currently the same is not required in the Service Tax.
  2. In the draft rules it is clearly mentioned that separate invoice has to be issued for non-gst supply of goods or services individually if the transaction amount is less than Rs 100 or at the end of the month a consolidated document to be issued called bill of supply for all the transactions where bill of supply has been not issued during the day.
  3. The existing invoice number series has to be modified as the draft rules talks about only invoice series being alphabetical or numeric
  4. There is also a requirement to print the reference number generated from the common portal on the tax invoice
  5. There is no concept of tax invoice being cancelled under GST once issued, in case if there is a need for such a case, then taxpayer has to issue a debit or credit memo.

At this point of time we may not have the full information on the Tax Invoice under GST, but we have an overview of the same based on that we need to do critical analysis of the business and come out of open issues where clarity is required and make representations to the concerned authorities to avoid last minute surprises, which may impact the continuity of business when GST is rolled out.

From the Model GST Law and the Business Process Reports on Returns, it is clear that government wants to track each and every transaction and avoid possible revenue leakages. A silver lining for the trade and industry is that the Model GST Law has clearly stated that input tax credit can be claimed on the debit / credit memos also.

Any views or opinions represented above are personal and belong solely to the author and do not represent those of people, institutions or organizations that the owner may or may not be associated with in professional or personal capacity, unless explicitly stated. Any views or opinions are not intended to malign any religion, ethnic group, club, organization, company, or individual.