Applicability of Provisions of GST to Casual Taxpayer and Non-Resident taxpayers as per Draft GST Law

Who are called Casual Taxpayers and Non- Resident Taxpayers ?

There are some taxpayers who occasionally undertake transactions involving the supply of goods and/or services in the normal course of their business as a principal, agent or in any other capacity. They do such transactions at a place where they do not have any fixed place of business. There are two categories of such taxpayers:

Casual Taxpayers

The taxpayers that are Resident in India but do not have a fixed place of business in the state(s) where they are doing supplies of goods and/or services for a short duration say One week to 12 weeks but not more than 90 days, these taxpayers are known as Casual taxable persons. Eg: Traders coming for supply of goods and/or services in trade fares.

Non-resident Taxpayers

The taxpayers that are not Resident of India and also do not have a fixed place of business in India and are doing supplies of goods and/or services for a short duration say One week to 12 weeks but not more than 90 days, then they are known as Non-Resident taxable persons. Eg: Companies coming for a shorter duration for accomplishment of a specific task in turnkey projects for which they bring specialized goods and/or providing services from foreign countries. 

Provision for obtaining Registration 

The Certificate of registration issued to a casual taxable person or a non-resident taxable person shall be valid for a period of ninety days from the effective date of registration. This period can be further extended to one hundred and eighty days in total with the approval of proper officer after expiration of the initial ninety days.

Requirement of Advance deposit

There is a requirement of making an advance deposit of tax of an amount equivalent to the estimated tax liability of such person for the period for which the registration is sought which is to be made at the time of submission of application for registration.

In case of the extension of registration period beyond the period for which the initial registration was taken is required, then such taxpayers shall deposit an additional amount of tax equivalent to the estimated tax liability of such person for the additional tax period for which the extension is sought.

The amount of amount deposited shall be credited to the electronic Cash ledger of the taxpayer and shall be utilized for discharge of his tax liability arising out of the actual supply of goods and/or services.

Filing and Compliance Requirements

Casual taxable person and Non-resident taxable person shall be required to file their Return of Outward supplies till 10th of the succeeding tax period, Return of Inward supplies till 15th of the succeeding tax period and Monthly returns till 20th of the succeeding tax period. Tax period means a complete month or part of the month during which they are registered. 

As per subsection 1 of Section 30 of the Draft GST law the Casual taxable person and Non-resident taxable person shall be exempt from filing of Annual Return.

Refer Schedule III, Section 2 (19) and Section 30 (1) of the Draft GST law for more clarity on the above provisions.

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The author is a qualified Chartered Accountant and Company secretary and working as a indirect tax consultant in GSTN project of infosys and can be reached out at mayankwadhera@gmail.com