Voluntary gst tax given in DRC FORM 3 US 122 AND US125
This query is : Resolved
23 December 2024
Can we use voluntary tax given us 122 and us125 for output tax payment.Please advise how form drc03 is utilised for tax payments.
24 December 2024
No, voluntary tax paid under Section 122 and penalty paid under Section 125 cannot be used for output tax payment.
24 December 2024
1. https://tax2win.in/guide/drc-03-gst-applicability-procedure-to-pay-additional-tax
2. https://www.taxbuddy.com/blog/gst-drc-03
2. https://www.taxbuddy.com/blog/gst-drc-03
25 December 2024
Pl tell about DRC-03 HERE IN DETAILS AS LINK NOT OPENING.
25 December 2024
Taxpayers should make payment using the DRC-03 form in GST in the following conditions -
Audit/Reconciliation Statement- Where the GST auditor has identified a case of shortfall of tax payment during the year, interest, penalties, or excess claim of the input tax credit. If the time limit to report such income in GST returns has expired, then the taxpayer must voluntarily make payment in form DRC-03 in GST and report it in GSTR-9.
Investigation and Others - If the taxpayer is under investigation by the GST department and it is found that he has defaulted in tax payment, then he can voluntarily make payment using form DRC-03.
Annual Returns - The taxpayer has to reconcile his books of accounts for the year before filing annual returns. If any short payment of taxes, interest, or penalties were found due to under-reporting or non-reporting of taxable supplies. Taxpayers can also pay these taxes with cash or by reporting it in Form DRC-03.
Demand or in Response to Show Cause Notice - The taxpayer can pay the tax demand along with the interest using the DRC-03 form in response to the show cause notice issued by the GST department. This form has to be issued within 30 days of the date of issue mentioned in the show-cause notice.
Liability Mismatch - GSTR-1 to GSTR-3B - In February 2021, the GST portal introduced this option when selecting the reason for using the DRC-03 form. If tax authorities issue a notice regarding a tax shortfall in GSTR-3B compared to GSTR-1, the taxpayer must either make the payment through DRC-03 or provide a response explaining the discrepancy.
ITC Mismatch - GSTR-2A/2B to GSTR-3B - In February 2021, the GST portal introduced this option for selecting the reason when paying tax through DRC-03. If a taxpayer claims excess Input Tax Credit (ITC) in GSTR-3B, exceeding the 5% limit allowed under CGST Rule 36(4) compared to GSTR-2B, the tax authorities may issue a notice. The taxpayer must use the DRC-03 form to pay the excess ITC claims.
Audit/Reconciliation Statement- Where the GST auditor has identified a case of shortfall of tax payment during the year, interest, penalties, or excess claim of the input tax credit. If the time limit to report such income in GST returns has expired, then the taxpayer must voluntarily make payment in form DRC-03 in GST and report it in GSTR-9.
Investigation and Others - If the taxpayer is under investigation by the GST department and it is found that he has defaulted in tax payment, then he can voluntarily make payment using form DRC-03.
Annual Returns - The taxpayer has to reconcile his books of accounts for the year before filing annual returns. If any short payment of taxes, interest, or penalties were found due to under-reporting or non-reporting of taxable supplies. Taxpayers can also pay these taxes with cash or by reporting it in Form DRC-03.
Demand or in Response to Show Cause Notice - The taxpayer can pay the tax demand along with the interest using the DRC-03 form in response to the show cause notice issued by the GST department. This form has to be issued within 30 days of the date of issue mentioned in the show-cause notice.
Liability Mismatch - GSTR-1 to GSTR-3B - In February 2021, the GST portal introduced this option when selecting the reason for using the DRC-03 form. If tax authorities issue a notice regarding a tax shortfall in GSTR-3B compared to GSTR-1, the taxpayer must either make the payment through DRC-03 or provide a response explaining the discrepancy.
ITC Mismatch - GSTR-2A/2B to GSTR-3B - In February 2021, the GST portal introduced this option for selecting the reason when paying tax through DRC-03. If a taxpayer claims excess Input Tax Credit (ITC) in GSTR-3B, exceeding the 5% limit allowed under CGST Rule 36(4) compared to GSTR-2B, the tax authorities may issue a notice. The taxpayer must use the DRC-03 form to pay the excess ITC claims.
25 December 2024
Steps for Filing DRC-03
Step 1: Sign in and go to the User Services page. Navigate to "My Applications" under "User Services" after logging into the GST Portal.
Step2: Select one of the three situations in which a taxpayer must make a payment:
Case 1: The taxpayer lacks a Payment Reference Number (PRN) and has not made any payments.
Case 2: Within thirty minutes after generating the PRN, a taxpayer arrives for payment even if the PRN was not used.
Case 3: After 30 minutes of generating PRN, a taxpayer comes for payment even if the PRN was not utilized.
Step 1: Sign in and go to the User Services page. Navigate to "My Applications" under "User Services" after logging into the GST Portal.
Step2: Select one of the three situations in which a taxpayer must make a payment:
Case 1: The taxpayer lacks a Payment Reference Number (PRN) and has not made any payments.
Case 2: Within thirty minutes after generating the PRN, a taxpayer arrives for payment even if the PRN was not used.
Case 3: After 30 minutes of generating PRN, a taxpayer comes for payment even if the PRN was not utilized.
25 December 2024
Steps in Case 1
Step (i): Click "New Application" after choosing "Intimation of Voluntary Payment – DRC-03" as the Application Type.
Step (ii): Whether a taxpayer chooses to pay voluntarily or against SCN, they have the following two options:
Voluntary payment: There won't be a way to modify the payment date; it will be automatically entered.
Payment against SCN: The taxpayer must manually input the SCN Number and choose the date of issue, which needs to happen no later than 30 days after the payment is made.
Applications for notifications of voluntary payments may be saved for a maximum of 15 days at any point during the completion process. The saved draft will be removed from the GST database if it is not filed within 15 days.
Go to Services > User Services > My Saved Applications to see your saved application.
Step (iii): Choose the Financial Year, the Section for which the payment is being made, and the From and To dates for the entire tax period.
Step (iv): Give payment information, including interest and penalties. A taxpayer can click "Add" to submit more information. Click "Proceed To Pay" after that.
Step (v): A page requesting voluntary contribution will appear, with three sections:
Details of Liabilities: This table shows the liabilities.
Cash Ledger balance: This table shows the amount of cash on hand as of a certain date. The amount to be paid from the available balance against outstanding liabilities has to be entered by the taxpayer.
Credit Ledger balance: This table shows the ITC that was available as of the date. The taxpayer must select Set-Off after entering the amount of the liability that must be paid through ITC.
Step (vi): A confirmation message detailing the amount of cash and ITC that was used to make the payment will appear. Upon selecting "Ok," a successful payment notification and a PRN will be produced. PRN can be retrieved from the "Electronic Liability Register" under Services>Ledgers>Electronic Liability Register if it is not available.
Step (vii): Click the "Preview" button on the "Intimation of payment made voluntarily or against SCN" page to examine the draft DRC-03.
Step (viii): If you have any, please explain in the space provided. To upload, select a file from the attachments section. Enter the "Place" and choose "Authorised Signatory" after clicking the verification checkbox.
Step (ix) Select "File" by clicking. There will be two choices:
Navigate the certificate in the file with DSC and select the "sign" button.
File with EVC: The email address and registered mobile number will receive an OTP. An ARN and a success message will be sent upon OTP validation.
Step (i): Click "New Application" after choosing "Intimation of Voluntary Payment – DRC-03" as the Application Type.
Step (ii): Whether a taxpayer chooses to pay voluntarily or against SCN, they have the following two options:
Voluntary payment: There won't be a way to modify the payment date; it will be automatically entered.
Payment against SCN: The taxpayer must manually input the SCN Number and choose the date of issue, which needs to happen no later than 30 days after the payment is made.
Applications for notifications of voluntary payments may be saved for a maximum of 15 days at any point during the completion process. The saved draft will be removed from the GST database if it is not filed within 15 days.
Go to Services > User Services > My Saved Applications to see your saved application.
Step (iii): Choose the Financial Year, the Section for which the payment is being made, and the From and To dates for the entire tax period.
Step (iv): Give payment information, including interest and penalties. A taxpayer can click "Add" to submit more information. Click "Proceed To Pay" after that.
Step (v): A page requesting voluntary contribution will appear, with three sections:
Details of Liabilities: This table shows the liabilities.
Cash Ledger balance: This table shows the amount of cash on hand as of a certain date. The amount to be paid from the available balance against outstanding liabilities has to be entered by the taxpayer.
Credit Ledger balance: This table shows the ITC that was available as of the date. The taxpayer must select Set-Off after entering the amount of the liability that must be paid through ITC.
Step (vi): A confirmation message detailing the amount of cash and ITC that was used to make the payment will appear. Upon selecting "Ok," a successful payment notification and a PRN will be produced. PRN can be retrieved from the "Electronic Liability Register" under Services>Ledgers>Electronic Liability Register if it is not available.
Step (vii): Click the "Preview" button on the "Intimation of payment made voluntarily or against SCN" page to examine the draft DRC-03.
Step (viii): If you have any, please explain in the space provided. To upload, select a file from the attachments section. Enter the "Place" and choose "Authorised Signatory" after clicking the verification checkbox.
Step (ix) Select "File" by clicking. There will be two choices:
Navigate the certificate in the file with DSC and select the "sign" button.
File with EVC: The email address and registered mobile number will receive an OTP. An ARN and a success message will be sent upon OTP validation.
25 December 2024
Steps in Case 2
Step (i): Comply with the procedures outlined in Case 1 until the taxpayer receives an acknowledgement of a payment they paid voluntarily or in opposition to the SCN page.
Step (ii): Check the box next to Have you made a payment by selecting "Yes." and input the PRN.
Step (iii): The phrase "Get payment details" will appear as a link. Details will automatically appear after the taxpayer clicks on it based on the specific payment that was made.
Step (iv) To examine the draft DRC-03, click "Preview." Then, submit the application using the same procedures as in Case 1.
Step (i): Comply with the procedures outlined in Case 1 until the taxpayer receives an acknowledgement of a payment they paid voluntarily or in opposition to the SCN page.
Step (ii): Check the box next to Have you made a payment by selecting "Yes." and input the PRN.
Step (iii): The phrase "Get payment details" will appear as a link. Details will automatically appear after the taxpayer clicks on it based on the specific payment that was made.
Step (iv) To examine the draft DRC-03, click "Preview." Then, submit the application using the same procedures as in Case 1.
25 December 2024
Steps in Case 3
Step (i): Comply with the procedures outlined in Case 1 until the taxpayer receives an acknowledgement of a payment they paid voluntarily or in opposition to the SCN page.
Step (ii): Check the box next to Have you made a payment? and input the PRN.
Step (iii): The phrase "Get payment details" will appear as a link. As stated in Case 2, the details will not be automatically filled in when you click the link and enter them. This occurs as a result of the 30-minute time limit having elapsed. The system will verify whether the amount submitted by the taxpayer matches the payment received during the processing that takes place at the back end. In that case, the notification form will be approved. In the event if not, an error message appears.
Step (iv): From this point on, submit the application DRC-03 by using the same procedures as outlined in Case 1. In Cases 2 and 3, an error notice requesting the taxpayer to input the unutilized PRN will be presented if the PRN has already been used.
Step (i): Comply with the procedures outlined in Case 1 until the taxpayer receives an acknowledgement of a payment they paid voluntarily or in opposition to the SCN page.
Step (ii): Check the box next to Have you made a payment? and input the PRN.
Step (iii): The phrase "Get payment details" will appear as a link. As stated in Case 2, the details will not be automatically filled in when you click the link and enter them. This occurs as a result of the 30-minute time limit having elapsed. The system will verify whether the amount submitted by the taxpayer matches the payment received during the processing that takes place at the back end. In that case, the notification form will be approved. In the event if not, an error message appears.
Step (iv): From this point on, submit the application DRC-03 by using the same procedures as outlined in Case 1. In Cases 2 and 3, an error notice requesting the taxpayer to input the unutilized PRN will be presented if the PRN has already been used.
25 December 2024
Reporting Cash Payments in GST Returns
Following the submission of the DRC-03, the payments are shown in different GST returns:
GSTR-3B: The electronic cash ledger is used to record cash and bank payments on these monthly returns. Taxpayers must make sure that all payments made through DRC-03 are appropriately reported here. This makes it easier to keep an accurate and transparent record of every transaction done throughout the month.
GSTR-9: This uses the electronic cash ledger for annual returns that can need extra tax payments. The annual tax liabilities should be reconciled by reporting the payments made through DRC-03. To make sure that all tax payments are included in the annual summary, it is crucial for taxpayers to carefully go over these entries.
Demand Notices: If demand notices are issued, taxpayers may use the Input Tax Credit (ITC) that is available, and any more amount owed must be paid in cash. Compliance depends on accurately reporting these payments in response to demand notices. This guarantees the settlement of all liabilities in accordance with the notification and the updating of the records on the GST portal.
Following the submission of the DRC-03, the payments are shown in different GST returns:
GSTR-3B: The electronic cash ledger is used to record cash and bank payments on these monthly returns. Taxpayers must make sure that all payments made through DRC-03 are appropriately reported here. This makes it easier to keep an accurate and transparent record of every transaction done throughout the month.
GSTR-9: This uses the electronic cash ledger for annual returns that can need extra tax payments. The annual tax liabilities should be reconciled by reporting the payments made through DRC-03. To make sure that all tax payments are included in the annual summary, it is crucial for taxpayers to carefully go over these entries.
Demand Notices: If demand notices are issued, taxpayers may use the Input Tax Credit (ITC) that is available, and any more amount owed must be paid in cash. Compliance depends on accurately reporting these payments in response to demand notices. This guarantees the settlement of all liabilities in accordance with the notification and the updating of the records on the GST portal.
25 December 2024
Following your successful DRC-03 filing, there are a number of crucial actions you should do to guarantee that the tax-related issues are resolved:
Status Update: The form's status usually changes to "Pending for approval by Tax officer" once you submit the DRC-03. This status means that the tax authorities are reviewing your request.
GST DRC-04 Acknowledgement: A GST DRC-04 acknowledgement will be sent to you. This acknowledgement is proof that the tax authorities have received your voluntary payment or request for rectification. It recognises the beginning of the process.
Tax Officer Review: The information contained in DRC-03 will be examined by the tax officer. This assessment involves a detailed analysis of the justifications for the voluntary payment or correction, together with any other materials you may have submitted.
Additional Communication: There might be more correspondence between you and the tax authorities, contingent on the details of your submission and the tax officer's review. They might ask for more explanations or proof to back up your claims.
Order using DRC-05 form: The issuing of an order in Form DRC-05 marks the end of the procedure. This order describes the tax authorities' decision, which was based on the data and supporting documents in DRC-03 and any correspondence that followed. The order will attest to the resolution of the issue if your voluntary payment or correction is approved. Should additional measures be necessary, the directive will furnish guidelines or determinations correspondingly.
The intricacy of the case and the tax authorities' workload can affect how long this process takes. The resolution of the issue might be accelerated by prompt cooperation and discussion with the tax officer. Following receipt of the order in Form DRC-05, it is imperative that you thoroughly analyze it and follow the instructions provided to take any necessary action. This guarantees that your tax-related concerns are successfully handled and settled in accordance with GST laws.
COURTESY:: https://www.taxbuddy.com/blog/gst-drc-03
Status Update: The form's status usually changes to "Pending for approval by Tax officer" once you submit the DRC-03. This status means that the tax authorities are reviewing your request.
GST DRC-04 Acknowledgement: A GST DRC-04 acknowledgement will be sent to you. This acknowledgement is proof that the tax authorities have received your voluntary payment or request for rectification. It recognises the beginning of the process.
Tax Officer Review: The information contained in DRC-03 will be examined by the tax officer. This assessment involves a detailed analysis of the justifications for the voluntary payment or correction, together with any other materials you may have submitted.
Additional Communication: There might be more correspondence between you and the tax authorities, contingent on the details of your submission and the tax officer's review. They might ask for more explanations or proof to back up your claims.
Order using DRC-05 form: The issuing of an order in Form DRC-05 marks the end of the procedure. This order describes the tax authorities' decision, which was based on the data and supporting documents in DRC-03 and any correspondence that followed. The order will attest to the resolution of the issue if your voluntary payment or correction is approved. Should additional measures be necessary, the directive will furnish guidelines or determinations correspondingly.
The intricacy of the case and the tax authorities' workload can affect how long this process takes. The resolution of the issue might be accelerated by prompt cooperation and discussion with the tax officer. Following receipt of the order in Form DRC-05, it is imperative that you thoroughly analyze it and follow the instructions provided to take any necessary action. This guarantees that your tax-related concerns are successfully handled and settled in accordance with GST laws.
COURTESY:: https://www.taxbuddy.com/blog/gst-drc-03
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