GST Returns Filing

Businesses liable to file GST returns must do so irrespective of their business structure. This includes online businesses and e-commerce aggregators.

Filing returns is mandatory under GST laws. Even if there are zero business transactions, you have to file a Nil return.

You cannot file a return if you have not filed the previous month's or quarter's return. A delay in GST return filing therefore has a cascading effect, leading to interest, late fees and hefty penalties.

GST is a trust-based taxation regime: the taxpayer self-assesses the tax liability, pays the tax and files returns. To ensure that taxpayers have assessed their liability correctly, a robust audit mechanism is a must, and audit is one of the measures the government takes for proper implementation of GST.

A GST audit examines records, returns and ancillary documents. Its purpose is to verify the declared turnover, taxes paid, refunds claimed and Input Tax Credit availed, and to scrutinise other compliance under the relevant laws.

Input Tax Credit (ITC) is one of the biggest reforms under the GST regime. To produce any goods or services, you must have purchased some sort of raw material. That raw material is called input, and the tax you pay on the purchase of those inputs is called input tax.

You can claim the tax you have already paid on inputs in your GST filing — this is called claiming ITC. Calculating ITC is complicated, as there are several statutory provisions, categories of inputs and notifications from the GST Council to keep in mind, so it is better to consult experienced professionals.

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