Decoding Returns under Goods and Service Tax (GST)

GST or Goods and Service Tax has been introduced to simplify the taxation process in India. GST has replaced the previous tax structure of VAT, excise duty, and service tax. Under GST, businesses are required to file returns on a monthly, quarterly, or annual basis, depending on their turnover. In this article, we will decode the returns under GST and provide a step-by-step guide to filing GST returns.

Key Terms

Before we proceed to decode the returns under GST, let's understand some key terms:

GSTIN: GSTIN stands for Goods and Services Tax Identification Number. It is a 15-digit unique identification number assigned to every registered taxpayer under GST.
Input Tax Credit: Input Tax Credit or ITC is the credit that businesses receive for the tax paid on purchases. A registered taxpayer can claim ITC for taxes paid on inputs used in their business.
Output Tax: Output tax is the tax charged by a registered taxpayer on the supply of goods or services to their customers.
Turnover: Turnover is the total value of goods or services supplied by a registered taxpayer during a financial year.

Types of Returns

Under GST, there are several types of returns that businesses need to file. Let's look at the different types of returns:

GSTR-1: GSTR-1 is a monthly or quarterly return that contains details of outward supplies made by a registered taxpayer. Businesses with a turnover of up to Rs. 1.5 crores can file GSTR-1 on a quarterly basis, while businesses with a turnover of more than Rs. 1.5 crores need to file GSTR-1 on a monthly basis.
GSTR-2A: GSTR-2A is an auto-generated return that contains details of inward supplies made by a registered taxpayer. GSTR-2A is generated on the basis of GSTR-1 filed by the supplier.
GSTR-3B: GSTR-3B is a monthly return that contains details of inward and outward supplies made by a registered taxpayer. GSTR-3B is a summary return, and businesses need to file it even if they have not made any outward supplies in a month.
GSTR-4: GSTR-4 is a quarterly return that needs to be filed by businesses registered under the Composition Scheme. The Composition Scheme is a scheme under GST that has been introduced for small businesses with a turnover of up to Rs. 1.5 crores.
GSTR-9: GSTR-9 is an annual return that contains details of inward and outward supplies made by a registered taxpayer during a financial year.

Process of Filing Returns

Now that we have understood the different types of returns under GST, let's look at the process of filing returns:

Prepare the necessary documents: To file GST returns, businesses need to have the following documents:
Invoice-wise details of all outward supplies made during the month/quarter
Invoice-wise details of all inward supplies received during the month/quarter
Details of credit/debit notes issued or received during the month/quarter
Details of any tax paid under reverse charge
Details of any advances received or adjusted during the month/quarter
Log in to the GST portal: After preparing the necessary documents, businesses need to log in to the GST portal using their GSTIN and password.
Select the relevant return: Once logged in, businesses need to select the relevant return that they want to file. For example, if they want to file GSTR-1, they need to select GSTR-1 from the menu.
Enter the necessary details: Businesses need to enter the necessary details in the return form. The form will have different sections, such as details of outward supplies, details of inward supplies, and details of tax paid.
Verify the details: After entering the details, businesses need to verify the details and make sure that everything is correct. They can also make any changes if required.
File the return: Once the details are verified, businesses can file the return. They will need to digitally sign the return using a Digital Signature Certificate (DSC) or an Electronic Verification Code (EVC).
Pay the tax: After filing the return, businesses need to pay the tax due using the online payment facility available on the GST portal.
Submit the return: Once the tax is paid, businesses need to submit the return. After submitting the return, a confirmation message will be displayed on the screen, and a receipt will be generated.

Conclusion

Decoding returns under GST is essential for any business operating in India. By understanding the different types of returns and the process of filing returns, businesses can ensure that they are compliant with the GST laws. Filing returns on time is important to avoid penalties and interest charges. Furthermore, filing accurate returns will help businesses claim Input Tax Credit and reduce their tax liability. We hope this article has provided a comprehensive understanding of GST returns and how to file them.