A GST report or GST return used for sales transactions provides a comprehensive overview of the Goods and Services Tax (GST) collected on sales by a business with-in a specific period. GST report or return is a mechanism that summarizes the GST received and paid by you.
Under the Goods and Services Tax (GST) system in India, businesses are required to submit various GST reports (or returns) to the government to ensure transparency, compliance, and tax collection.
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These returns help the government track the flow of goods and services and collect taxes at each stage of the supply chain. All GST registered dealers must have to file monthly or quarterly GST report or GST returns and an annual GST report or GST return based on the type of business. These GSTR filings are done online on the GST portal.
Here’s an overview of the main GST reports that businesses need to file:
GST report or GST report or GST return
1. GSTR-1: Details of Outward Supplies (Sales)
All registered businesses (except small taxpayers filing under the Composition Scheme) must file GSTR-1. GSTR-1 contains details of the outward supplies or sales made by the business during the tax period. It includes information such as:
- Invoice-wise details of sales to other GST-registered businesses (B2B transactions).
- Summary of sales to end consumers (B2C transactions).
- Exports and exempted supplies.
- Zero-rated sales and any other details related to outward supplies.
- Filing Frequency: Monthly (or quarterly for businesses with turnover up to ₹5 crore under the Quarterly Return Monthly Payment (QRMP) scheme.
2. GSTR-2: Details of Inward Supplies (Purchases) (Currently suspended)
GSTR-2 was meant to capture the details of inward supplies or purchases made by the taxpayer from other businesses. It would contain the purchase details from suppliers, including the tax paid on those purchases.
- Invoice details of purchases made.
- Details of credit or debit notes received.
- Input tax credit (ITC) claimed.
- Filing Frequency: It was to be filed monthly. However, the filing of GSTR-2 has been suspended since 2017, and the reconciliation of inward supplies is now managed through GSTR-3B.
GSTR-2A:
Form GSTR 2A is a purchase-related dynamic tax return that is automatically generated for each business by the GST portal.
GSTR-2B:
Form GSTR-2B is a new static month-wise auto-drafted statement for regular taxpayers (whether or not opted into the QRMP scheme) introduced on the GST portal.
3. GSTR-3B: Summary of Outward and Inward Supplies
All GST-registered businesses must file GSTR-3B, regardless of whether they are filing GSTR-1.
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This is a summary return that businesses file to report their GST liability (net tax payable) for the month. It includes:
- Outward Supplies (Sales): Total sales made and taxes collected.
- Inward Supplies (Purchases): Total purchases made and taxes paid.
- Input Tax Credit (ITC): The amount of ITC claimed on purchases and expenses.
- Net Tax Liability: The final amount of tax payable to the government after adjusting for ITC.
- Filing Frequency: Monthly (or quarterly under the QRMP scheme for small taxpayers).
Note: If any registered firm who opted monthly option during the registration must have to file 2 GST reports or GST returns on monthly basis these are – GSTR 1 and GSTR 3B.
Note: If any registered firm who opted quarterly option during the registration must have to file 2 GST reports or GST returns on quarterly basis these are – GSTR 1 and GSTR 3B.
4. GSTR-4: Quarterly Return for Composition Scheme
This return is for businesses that have opted for the Composition Scheme, which allows small businesses to pay tax at a reduced rate.
What it includes: GSTR-4 captures:
1. Details of outward supplies (sales).
2. Summary of inward supplies.
3. Tax paid under the Composition Scheme.
4. Filing Frequency: Quarterly.
5. GSTR-5: Return for Non-Resident Taxable Persons
Non-resident taxable persons (i.e., businesses not based in India but supplying goods or services in India). GSTR-5 is a return for non-resident businesses to report their sales, purchases, and tax liabilities.
Filing Frequency: Monthly.
6. GSTR-6: Return for Input Service Distributors (ISD)
Businesses acting as Input Service Distributors (ISD), typically large organizations or multi-location businesses, need to file this return. GSTR-6 reports the details of the distribution of input tax credit among the different units or branches of the business.
Filing Frequency: Monthly.
7. GSTR-7: Return for Tax Deducted at Source (TDS)
This return is required to be filed by entities that are required to deduct tax at source (TDS) under GST provisions (such as government departments or other specified organizations).
What it includes: GSTR-7 includes:
- Details of tax deducted at source on payments made.
- Information about the TDS liability and payment made.
- Filing Frequency: Monthly.
8. GSTR-8: Return for E-commerce Operators (TCS)
E-commerce operators who are required to collect tax collected at source (TCS) on transactions made by sellers on their platform. GSTR-8 reports the TCS amount collected, along with the details of the sellers and the sales made.
Filing Frequency: Monthly.
9. GSTR-9: Annual Return
All GST-registered businesses with an annual turnover of more than ₹2 crore need to file GSTR-9, which is a comprehensive annual return summarizing all transactions made during the financial year.
What it includes: GSTR-9 includes:
1. Details of outward and inward supplies for the year.
2. Summary of tax paid during the year.
3. Adjustments to the previous returns, if any.
4. Reconciliation of figures in GSTR-9 with the financial statements.
5. Filing Frequency: Annually.
10. GSTR-10: Final Return
GSTR-10 is filed by businesses that have cancelled their GST registration. This return captures the details of the final output tax and the input tax credit adjustment that needs to be made upon cancellation.
Filing Frequency: Once, upon cancellation of GST registration.
11. GSTR-11: Return for Persons Having UIN (Unique Identity Number)
This return is for persons having UIN, such as foreign diplomatic missions or UN agencies, who are exempt from paying GST on purchases but are eligible to claim a refund.
GSTR-11 contains details of the inward supplies made and the refund claimed for taxes paid.
Filing Frequency: Monthly.
GST Filing Process:
1. Collect Sales and Purchase Data: Collect details of all transactions, including sales, purchases, taxes collected, and taxes paid during the period.
2. Prepare GST Reports: Prepare the respective GST report or GST return (e.g., GSTR-1, GSTR-3B, etc.) based on the data collected.
3. Submit Returns on GST Portal: File the returns online through the GST portal. (www.gst.gov.in).
4. Pay Taxes (if any): If the output tax is greater than the input tax credit, pay the difference to the government.
5. Reconcile Returns: Ensure that the details in your GST report or GST returns match your books of accounts and reconcile any discrepancies.
Common Issues in GST Filing:
Mismatch in GSTIN: Incorrect GSTIN details may cause returns to be rejected.
Input Tax Credit Errors: Failure to reconcile input credit and output liability can lead to tax errors.
Late Filing: Filing returns after the due date can result in penalties and interest.
Errors in Tax Rate Application: Applying incorrect GST rates on goods or services can cause issues during audits.
To ensure smooth compliance with GST, businesses should maintain accurate records, reconcile returns regularly, and file on time. Various software tools can also help streamline the process of generating and filing GST report or GST returns.
Penalties for not filing GST returns include1234:
Late fee: ₹50/day for regular returns and ₹20/day for nil returns.
Interest: 18% per annum on outstanding tax liability.
Failure to register for GST when required results in a penalty of ₹10,000 or the amount of tax payable, whichever is higher.