During the Year if there is an error between CGST, SGST and IGST interchanged in reporting, but the gross value of the taxes matches, can the same be correctly reported in GSTR 9?

If CGST, SGST, and IGST are interchanged while reporting in GSTR-1, the same cannot be corrected while filing GSTR-9. Table 9 – Details of taxes paid of GSTR-9 cannot be edited except tax payable column. However, the assessee can correctly report the actual taxes payable under respective heads while updating Table 9, though, this correct reporting does not account for automatic intra adjustment of tax under CGST, SGST, and IGST. The shortfall of tax needs to be paid off while filing GSTR-3B of the subsequent month or by filing DRC-03 and the taxes paid in excess erroneously can be claimed as a refund. Also, there is no interest liability on taxes shortly paid in such cases.

A sales figure that was originally reported as B2C sales in GSTR-1, was later corrected to B2B sales, how should the reporting be done?

Table 4 of GSTR-9 requires details of both B2B and B2C supplies. In this case, the assessee has to report sales under B2B in Table 4, as this is the correct classification even though it was wrongly reported as B2C in GSTR-1.

A GSTR-3B was filed with wrong (excess) outward supplies and tax paid on the same, but the actual/correct supplies were declared in GSTR-1 for the same period, then in that case is there any way to get a refund of excess amount paid?

If taxes are erroneously paid in excess in GSTR-3B, the same can be claimed as a refund (as per Section 54 of CGST Act) or be adjusted against tax payments of subsequent periods. But, the same cannot be claimed though GSTR-9. The refund needs to be claimed by making an application for the same on GST portal.

Reverse Charge had been paid, but wrongly reported in GSTR-3B in 3.1.a as against 3.1.d, how can this be rectified while filing GSTR-9?

An assessee should make a correct reporting under GSTR-9 by disclosing the reverse charge paid under Table 4G even though if there is incorrect reporting under GSTR-3B.

Can a refund be claimed for Credit Notes which cannot be adjusted in 2018-19 for FY 2017-18?

No, a refund of credit notes which cannot be adjusted in FY 2018-2019 (pertaining to FY 2017-2018) cannot be claimed as the incidence of tax on such supply has been passed to the recipient.

If there is a difference between GSTR-3B & GSTR-2A then how do we rectify the same in GSTR-9?

The difference between auto-populated ITC details from GSTR-2A and those declared in GSTR-3B needs to be explained in GSTR-9 under the following 2 heads: Table 8E: ITC available but not availed Table 8F: ITC available but ineligible

We have not done any reversal of ITC while filing GSTR-3B in the past, now how do we go about the same while filing GSTR-9?

If any reversal of ITC was missed in past months GSTR-3B, the same can be done in subsequent months GSTR-3B. The same should be correctly reported in Table 7 of GSTR-9 and the excess liability created because of such reversal should be paid off.

How do we differentiate the ITC into Capital goods, Input and Input Services?

Table 6B of GSTR-9 requires differentiate of ITC into Capital goods, Inputs and Input Services. Books of accounts have to be maintained in a manner such that purchases attributable to output supply of goods, output services, and capital goods can be identified and thus ITC on the same can be differentiated. However, there is no difference in treatment of ITC between goods and services. Hence, such bifurcation may be dispensed with in the first year as the assessee may not have maintained books in the required manner due to non-requirement in GSTR-3B.

TDS Under GST - Understanding and Simplifying This Annual Return

TDS Under GST

Are you a business owner operating in India? If so, you’re likely familiar with the complicated structure of the Goods and Services Tax (GST) system. However, there’s a critical aspect of Tax Deducted at Source or TDS under GST that you can’t afford to ignore.

Understanding TDS under GST is not just an option; it’s an imperative for any business owner. It ensures your business remains compliant with the applicable GST law, steering clear of penalties and legal hassles. In this article, we will unravel the complexities of TDS under GST, covering everything from the basics to factors influencing the TDS rate, how to calculate it accurately, staying compliant, dealing with penalties, and pro tips for efficient TDS management.

Demystifying TDS on GST

Meaning of Tax Deductible at Source (TDS)

TDS, in essence, is a form of tax that’s deducted at the source of payment. In the context of GST, it’s the amount taken out by the payer when making payments to suppliers of goods or services. The deduction hinges on the prescribed TDS rate on GST. Its importance cannot be overstated – it aids the government in monitoring business transactions, ensuring tax compliance, curbing tax evasion, promoting transparency in transactions, and facilitating tax collection. As a responsible business owner, it’s crucial to deduct and deposit the GST TDS amount within the stipulated timeframe. Failure to adhere to TDS regulations can lead to punitive measures and legal repercussions.

Who is liable to deduct TDS under GST law?

TDS provisions were made applicable w.e.f. 1^st October 2018.

Sec 51 of The CGST Act provides for applicability of TDS as below-

A department or an establishment of the Central Government or State Government; or
Local authority; or
Governmental agencies; or
Such persons or categories of persons as may be notified by the Government.

Following persons are notified under this clause-

An authority or a board or any other body which has been set up by Parliament or a ate Legislature or by a government, with 51% equity (control) owned by the government.
A society established by the Central or any State Government or a Local Authority and the society is registered under the Societies Registration Act, 1860.
Public sector undertakings.

Getting Down to basics & applicability

Threshold Limit

GST TDS provisions apply where total value of such supply, under a contract exceeds Rs. 2.50 lakhs (excluding GST)- Sec 51(1) of the CGST Act

The limit of Rs. 2.50 lakh is per contract. Thus, if contract value exceeds Rs. 2.50 lakhs; TDS is required to be deducted even if individual invoice amount is less than Rs. 2.50 lakhs.

TDS on GST is not applicable in following cases:

1.Contact value does not exceed of Rs-2.5 Lakhs.

2.If Supplier is unregistered under GST.

Where the location of the supplier and place of supply is in a State/UT which is differentfrom the State/UT where the deductor is registered
Where goods or services are received which are exempt under the GST laws
Where the tax is to be paid on reverse charge by the recipient i.e. the deductee

Rate of TDS

The GST law provides that the deductor would be required to deduct TDS at the rate of 1% of CGST and 1% of SGST/UTGST or 2% of IGST.

GSTR –7 Return Compliance and Penalties

To steer clear of any legal quagmires, it’s imperative to comply with TDS regulations under GST. Here’s a concise breakdown of the compliance requirements:

Return:

GSTR-7 is a monthly return filed by individuals who deduct tax at source. Every GST Registered individual who deducts TDS under GST must file in form. GSTR-7 by the 10^th of next month.

Consequences of non-filing:

If the GST Return is not filed on time, then a penalty of Rs-100 under CGST and Rs-100 under SGST Shall be levied, and the total will be RS-200 per Day. However, the maximum late fees should not exceed Rs-10,000.

Furthermore, where any TDS deductor fails to pay the amount deducted as tax, he would be liable to pay interest in addition to the amount of tax deducted.

Claiming TDS credit under GST by Supplier

The details furnished by the TDS deductor in Form GSTR-7 would be made available to each of the deductees on the GSTN portal for claiming the amount of tax deducted in his electronic cash ledger after validation. Such details would be made available through a certificate in Form GSTR-7A.

The deductee can accept or reject (including the amendments) the TDS credit received by him over the GSTN portal. The accepted amount would be directly credited to his Electronic Cash Ledger.

Refund of excess balance in Electronic Cash Ledger relating to TDS credit

The CBIC has clarified[38] that the amount deducted as TDS under the GST law and credited to the electronic cash ledger, would be considered equivalent to cash deposited in the electronic cash ledger. Therefore, the procedure to claim a refund in such a case is similar to the manner of claiming a refund of excess balance in Electronic Cash Ledger.

Conclusion

Comprehending the TDS rate on GST is indispensable for businesses navigating India’s tax landscape. Staying updated on TDS slab rates and regulations is instrumental in streamlining operations and mitigating the complexities of TDS deduction and payment. We encourage you to be vigilant, stay informed about the latest developments in TDS and GST.

For further technical guidance on TDS Under GST, reach out to us.