SUB GST p6.8

What is GSTR 7 & How to file GSTR 7?

4 May 2020

GSTR-7 – Return for a person required to deduct tax at source

Whenever taxable goods or services or both are supplied to a Central/ State Government’s Department/ establishment or, local authority, or Governmental agencies, the recipient is required to deduct tax at source and file a return under Goods and services tax Act.

Monthly return

Deductors shall furnish a monthly return in Form GSTR-7 electronically through the common portal.

What is the last date of filing return?

The details in GSTR-7 should be furnished on/before 10th of the month succeeding the calendar month in which tax has been deducted at source.

TDS details made available in GSTR-2A/4A 

The details of TDS furnished by the deductor in GSTR-7 shall be made available electronically to each of the suppliers in Part C of Form GSTR- 2A/ Form GSTR- 4A (in case of the registered person opting for composition levy) on the common portal after the due date of filing of Form GSTR- 7. The supplier can take this amount as credit in his Electronic Cash Register and use the same for payment of tax or any other liability.

Tax Deduction at Source (TDS) Certificate 

A TDS certificate is required to be issued by a deductor (the person who is deducting tax) in Form GSTR-7A to the deductee (the supplier from whose payment, TDS is deducted), within 5 days of crediting the amount to the Government. It contains the details pertaining to the value on which tax has been deducted, rate of deduction, amount of tax deducted at source, and the amount paid to the Government.

The due date for payment of tax 

Due dates for payment of tax in respect of the persons required to file GSTR- 3B, GSTR-4, GSTR-5, and GSTR-7 are linked with the due dates for filing of such returns i.e., the last dates (due dates) of filing such returns are also the due dates for payment of tax in respect of persons required to file such returns.

However, non-resident taxable persons or casual taxable persons are required to make an advance deposit of tax of an amount equivalent to the estimated tax liability of such person for a period for which registration is sought or extension of registration is sought in terms of section 27(2).

Rectification of errors/omissions

Rectification in the return to be filed for the month/quarter during which such omission or incorrect particulars are noticed. Any tax payable as a result of such error or omission will be required to be paid along with interest. 

Exception

It is important to note that section 39(9) does not permit rectification of error or omission discovered on account of scrutiny, audit, inspection, or enforcement activities by tax authorities. Hence, the assessee may not be able to pass on the ITC to the receiver in respect of tax payments made by him in pursuance of account of any of the aforementioned situations. 

The time limit for making rectification 

The maximum time limit within which the rectification of errors/omissions is permissible is earlier of the following dates: 

• Due date of filing of return for the month of September/ quarter ending September following the end of the financial year [i.e., 20th October of next financial year] or 

• The actual date of filing of the relevant annual return 

The last date of filing of annual return is 31st December of the next financial year. Hence, if the annual return for the year 2017-18 is filed before 20th October 2018, then no rectification of errors/omissions in returns pertaining to FY 2017-18 would be permitted thereafter.

Details to be provided in GSTR-7

1. Taxpayers will be allotted a state-wise PAN-based 15-digit Goods and Services Taxpayer Identification Number (GSTIN). GSTIN will be auto-populated at the time of return filing.

2. The name of the taxpayer will be auto-populated at the time of logging into the common GST Portal. The trade name of the registered person will also get auto-populated.

3. A taxpayer shall mention the details in respect of TDS deducted such as GSTIN of the deductee, total amount, and TDS amount.

4. Any correction to the data submitted in the return of previous months can be done by filling the original and revised details. Based on an amendment made, the TDS certificate (GSTR-7A) will get revised.

5. A taxpayer shall mention the details of the tax amount deducted from the deductee and the tax amount paid to the government.

6. If there are any interest fees or late fees applicable to the TDS amount, the Taxpayer shall mention the details of such interest and late fees payable along with the amount paid to date.

7. If a taxpayer wants to claim the refund of Tax Deducted at Source(TDS) from electronic cash ledger, then he must mention such details. Taxpayers should also provide bank details where the amount of refund for TDS should be credited.

8. Debit entries in electronic cash ledger are auto-populated, once a taxpayer finishes filing the return and the payment of TDS along with interest if any.