GST Tip – 297

GSTR – 3B has to be filed by 20th Aug 2017 for the month of July transaction with GST. Following are the key points

  1. Every tax payers under GST except registered under composition has to file this return.
  2. Data entered in GSTR – 3B will be reconciled with the GSTR – 2 and GSTR – 2 to e filed subsequently
  3.  Taxpayers have to discharge the liability of GST only by payment and existing ITC cannot be utilized, stress on cash flows.
  4. While entering data in GSTR – 3B, complete the returns of GSTR – 1, so that there will be minimal reconciliation issues
  5. No offline utility, return has to be filed online only

Are we ready for the game ?

GST is rolled out from 1st of July 2017 and the trade and industry is able to adapt to the same with some teething troubles. Though all the issues are not resolved some of them are still and it takes some time to get resolved. One month has passed after the rollout of GST and now it is the time for filing of returns. The same is updated through a press release by CBEC on 18th June 2017 – http://www.cbec.gov.in/resources//htdocs-cbec/press-release/press-note-on-return-filing.pdf

As there is a delay in filing of the returns, a new form is known as GSTR – 3B has been introduced and it has to be filed by 20th of Aug 2017. The format is released by the Government. It is basically a summary of the return for the month of July 2017 for determining the net tax liability to be paid. This statement looks simple but the challenge is on a careful review of the format it is clear that there is no provision for the opening balance of the input tax credit as of 30th June 2017. The reason is the GST Tran-1 form has to be filed within 90 days from the appointed date i.e 1st of July 2017. As a result of the closing balance of the Input Tax Credit will not be available for the taxpayers to use the same for payment of taxes for the month of July 2017.

This will have a huge impact on the cash flows as the tax payers have to pay in cash without using the available input tax credit and it is going to impact the MSME sector a lot especially for taxpayers who were not eligible to take registration under Central Excise in the erstwhile regime now they have to pay CGST.

The portal for the GST i.e GST.gov.in is not having the option of filing of the GSTR – 3B as on date, that means the taxpayers have to wait for some more time for filing of the return. This time lag should be utilized by the taxpayers for renegotiating with their customer to receive the payments or at least for the tax amount. Alternatively, they have to look out for additional cash flow either through additional funding or increase their CC limits or another means.  The same is likely to continue for the next month also.

Managing of the working capital is one area and another is ensuring that the data required for the return filing is also in place. GSTR – 3B is an interim return and the actual returns for GST have to be filed by 10th of September i.e, GSTR – 1 by 5th September 2017 and GSTR – 2 by 10th September 2017.

 

GST Tip – 203

As per the Draft Input Tax Credit Rules, Input Tax Credit is available only if the registered person has issued the tax invoice for the supply of goods or services as given in the Revised Invoice Rules and the same is furnished in the GSTR – 2 of the recipient and GSTR -1 of the supplier of goods or services are matched.

 

GST Tip 109

GSTR – 3 is a monthly return to be filed on basis of the finalized data of outward supplies i.e GSTR – 1 and inward supplies i.e GSTR – 2 along with the amount of tax, interest, late fees and penalty paid for the month.

GST Tip – 108

GSTR – 2A data will be auto-populated based on the data filed in GSTR – 1(outward supplies return filed by the supplier), GSTR – 6 (Quarterly return filed by the Input Service Distributor), GSTR – 7 (Monthly return filed by the Tax Deductor)  & GSTR – 8 ( Monthly return filed by the tax collector at source (e-commerce operator) in various tables.

GST Tip – 107

In GST, there will be some cases where the input tax credit availed has to be reversed like if the buyer has taken on provisional basis and supplier has not paid the tax or input tax credit availed on inward supplies but the same were used in supply of exempted goods, then Input tax credit availed has to be reversed along with the reason for reversal in Table 14 of GSTR – 2