Note on the Draft of Simplified GST Returns approved by GST council

GST council has approved the GST return design in its 27th meeting, however, the key features and the drafted formats were approved in its 28th meeting. The main features of these monthly returns would be:

1. Single monthly return for large taxpayers (20th of next month)

2. Quarterly NIL returns & facility to file quarterly returns by an SMS.

3. Small Taxpayers (Turnover less than 5 Crores) shall file quarterly return though payments shall be made on monthly basis.

4. Continuous uploading of invoices & Viewing facility

5. Self-admitted liability in case of return not filed through the invoices was uploaded.

6. Unidirectional flow of document to claim input tax credit

7. Missing Invoice reporting with interest and penalty after 2 tax periods

8. Offline IT tool in excel along with filtering facility

9. No automatic reversal of Input tax credit & recovery shall be made through a due process

10. Locking of invoices indicating acceptance of entering the transaction reported.

11. Rejection of Invoices by the taxpayer in case the recipient wrongly mention the GSTIN

12. Pending & amendment of Invoices

13. Deemed locking and Unlocking of invoices

14. Capturing HSN up to 4 or more digits in regular return

15. Two main tables in the return - one for reporting supplies and other for availing Input tax credit.

16. Payment of multiple liabilities

17. Amendment return to address human errors

18. Amendment of missing invoices and other details

19. Payment of liability arose due to the amendment & higher late fee for amendment return

20. Monthly accounting & assessment facility on the common portal

21. Facility of uploading Shipping bill in case of exports

22. Transmission of data to ICEGATE

23. Input tax credit on self-declaration basis till data transmits from ICEGATE to SEZ online

24. Supplier's side control in the best interest of the recipient

25. Profile-based return to show him only a few types of supplies to report based on his profile

26. Purchase information in the annual return

27. Suspension of registration in case the registered person applied for cancellation of registration

28. Sahaj (B2C outward supplies) & Sugam returns (B2B + B2C outward supplies)

This simplification of GST returns would benefit by reducing the compliance costs for taxpayers. Minor/clerical errors would not lead to the initiation of legal actions. A questionnaire would be available for the taxpayers for checking the eligibility to opt for quarterly filing and to enable the profile based returns. The drafted returns were made available online & they would be made available once they get approved.

Taxpayers have to wait and see as to how this simplification process is going to help them. Hope it will not make the filing more cumbersome as the GSTN is tuned up to handle volumes of data & the network experienced frequent crashes. Ending up the note with several questions in mind as to how the invoices pertaining to deemed sales will be treated in the returns.