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Published on:

July 1, 2024

Viraaj Vashishth

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Explore GST

Basics of GST

Understanding GST Return: Exploring the Basics of GSTR-3B

Goods and Services Tax (GST) is an inclusive indirect tax on the supply of goods and services in India, which replaces multiple levies applied earlier with the idea of creating a simpler and more efficient system of taxation. Periodic filing of returns for tax purposes is required for businesses registered under GST. Businesses must adhere to GST regulations by filing their returns.

The returns give details on transactions conducted by a business, its tax liability, as well as ITC claims that it makes. Filing these returns in time will ensure proper collection of taxes thus enabling deserving benefits to be claimed by businesses through input credit. Most firms registered under GST need to file a monthly or quarterly summary return called GSTR-3B. It’s time now to dive into this important return type and know what is GSTR-3B form.

What is GSTR-3B?

GSTR-3B provides a summary view of all outward supplies (sales), inward supplies attracting reverse charge (purchases), ITC claimed during the period or quarter under review and net tax payable thereon for that period or quarter.

Purpose of GSTR-3B:

1. Make GST tax declarations for a month/quarter.

2. Help in paying this money to the government.

Different from other Returns under GST:

1. More detailed than GSTR-1, GSTR-2A, which are all taxation returns.

2. While GSTR-1 records outward supplies, information on suppliers’ GSTR-1 feeds into GSTR-2A and finally we have an annual return with a detailed tax description referred to as GSTR-9.

Unlike this, GSTR-3B provides a consolidated summary for the month/quarter that is being submitted by taxpayers using simpler terms.

Who Needs to File It?

1. Every regular or casual taxable person having a registration under GST must file this document irrespective of turnover except where otherwise specified about business under certain schemes or turnover too small to be considered for filing purposes.

2. The threshold limit for filing GSTR 3B may vary depending on the type of business you are operating (special category states etc.). For specific applicability based on your business situation, you should consult your tax professional.

GSTR-3B Components

GSTR-3B is a return that includes major data such as GSTIN, name of the taxpayer, period of the return, supplies made outwardly, inward supplies under reverse charge mechanism, ITC admissible, tax liability and payment thereof and gstr-3b late fee and penalties. It also discloses taxable/non-taxable/zero-rated outward supplies or services, identifies the supplier liable for tax payments to authorities and enumerates input tax credits availed against inward supplies.

FORM GSTR-3B

Process for GSTR-3B Filing

GSTR-3B return is a self-declaration document which registered taxpayers under GST in India should file on a monthly basis. As such, it is a summary of the outward and inward supplies made by any taxpayer for the month under consideration. The following are steps to be taken when filing form GSTR-3B.

Step 1: Log in to GST Portal

Simply go online to https://www.gst.gov.in/. You can do this using your ID (GSTIN), your username and password.

Step 2: Navigate to GSTR-3B

When you log in, click on the ‘Services’ tab and click ‘Returns’ then ‘Returns Dashboard’

Step 3: Select the Return Period

Select the financial year from the drop down menu and choose the month for which return is being filed. Click on ‘SEARCH’.

Step 4: Prepare GSTR-3B

Go to Monthly Return GSTR-3B link tile and press PREPARE ONLINE button, and fill all details applicable in each respective section such as:

1. Details of Outward Supplies and inward supplies liable to reverse charge,

2. Inter-State supplies;

3. Eligible ITC;

5. Exempt, Nil, and Non-GST inward supplies;

6. Payment of Tax;

7. TDS/TCS Credit;

Step 5: Validate the Information

After entering all those required details click the SAVE GSTR-3B button. An ok message will appear; just click OK. Make sure that all information provided is correct.

Step 6: Pay Off Liabilities

1. Save this data and then click on ‘PAYMENT OF TAX’ to see the liabilities summary.

2. Take advantage of the ‘Tax Payable’ column to set off liabilities against available ITC (Input Tax Credit).

3. Click on 'Offset Liability' and then confirm by clicking on 'Proceed'.

Step 7: Submit GSTR-3B

1. Once you have paid off your liabilities, hit the ‘FILE GSTR-3B WITH DSC/ EVC’ tab.

2. For DSC (Digital Signature Certificate), choose your authorized signatory and click on proceed.

3. If using EVC (Electronic Verification Code), type in OTP sent to your registered mobile number and email. A confirmation message will appear after successful filing has been done.

Step 8: Download and Save Acknowledgement

After you have filed successfully, an Acknowledgment Reference Number (ARN) will be generated. Download the filled GSTR-3B form and save the acknowledgement for future reference.

What is GSTR-3B Due Date:

GSTR-3B is normally due by the 20th day of next month following which tax period occurred but may have extensions in some cases.

Conclusion

This document is significant while accounting for business taxes. Penalties are avoidable and businesses can run smoothly if returns are filed properly and timely. Furthermore, there might be amendments related to return formats or procedures due to future changes in the GST laws regime. This calls upon constant updating about these changes for individual compliance with GST laws.

FAQs

1. What is GSTR-3B?

Summing up of supplies made outward, inward supplies (reverse charge), ITC claimed and tax liability in a particular period either monthly or quarterly.

2. Who should file GSTR-3B?

Most GST-registered businesses are required to file it regardless of their turnover. However, there are some schemes for which the rules can be relaxed, as well as cases of very low business activity.

3. What is the importance of filing GSTR-3B?

It ensures compliance with GST requirements and assists in claiming ITCs while avoiding late fees and fines.

4. How frequently do I have to pay GSTR-3B?

Generally, this return is submitted by the 20th of the subsequent month where monthly submission is required while there are more time allowances for those who submit every quarter.

5. How to file GSTR-3B?

This can be done online at the GST Portal.

6. What documents do I need when filing GSTR-3B?

For that period you will require your logins on GST platforms together with information about your business transactions.

7. What data does GSTR-3B collect?

It includes general details like name, GSTIN, period; taxable supplies, exempted goods, nil rated goods; inward supplies under reverse charge mechanism; inputs credit claimed; tax liability CGST/ SGST/UTGST/ IGST & cess if applicable along with any late fee due thereof.

8. Do I have to give invoice-wise information?

No such detail is needed in GSTR-3B but only total amounts grouped under every heading.

9. If I don’t have any transactions, should I file GSTR-3B?

Nil GSTR-3B is still to be filed by companies missing out on any transaction in a given month.

10. What if the figures of my GSTR-2A and GSTR-3B differ?

Harmonize these returns. In case your input tax credit (ITC) claimed in GSTR-3B is greater than that in GSTR-2A, then you need to communicate with your suppliers about the differences. If lower, amend your GSTR-3B to capture the missing invoices.