What are the Penalties for Late Filing of GST Returns ?

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What are the Penalties for Late Filing of GST Returns ?

By Advocate Kohal Dev Sharma, Punjab & Haryana High Court

The laws concerning GST clearly define the offences and the penalties as well as punishments for all of those offences depending upon the scenario. It is therefore really important to know that a single mistake, even if it is an inadvertent one can lead to some really severe consequences. In order to prevent any sort of evasion of tax or corruption of any kind, the GST law has laid down some really strict provisions for the offenders who commit such acts leading to either penalties, punishments or even arrests in severe cases.

What could happen in case of an offence?

Well, to be honest, a lot can happen in case an offence is committed under the GST law. As per the provisions of the GST law, there are 21 offences in total. Some of them are major offences with serious penalties and punishments, while others are minor offences with not so serious punishments.

Some of the major offences are as follows:

  1. Not getting registered under GST.
  2. Issuing false invoice or supplying some goods without any invoice.
  3. Submitting false information while filing GST returns.
  4. Submitting fake or false financial records, documents or files or fake returns in order to evade taxes.
  5. Issuing invoices by a taxable person using the GSTIN of another bona fide person.
  6. Suppressing sales in order to evade taxes deliberately.
  7. Obtaining refunds by means of committing a fraud.

All of the above mentioned offences are the major ones and have severe penalties and punishments that are specifically mentioned under the GST law. All of these offences have different penalties and vary depending upon the seriousness of the offence.

Is there a penalty for late filing?

Yes, there is and it is called late fee. For some, the penalties for delayed filing of GST can be overwhelming. In case of delayed filing of GST returns, the penalty will be Rs.100 per day per act, which means Rs.100 each for CGST and SGST resulting in a late fee of Rs.200 per day and to the maximum limit of Rs.5000. However, in case of IGST the amount of late fee for delayed filing is Rs.200 per day. Apart from the late fee, interest to the tune of 18 percent per annum is also to be paid by the tax payer and the same has to be calculated on the amount of tax that is to be paid. The time period for the same will be from the next day of filing till the date of payment.

As per the law the taxpayer has to file GST well within time and in case of delay there is a provision for imposition of late fee and the amount may change from time to time. It is therefore necessary to ensure that GST is filed in due course of time in order to avoid imposition of penalties.

What if you don’t file GST for a month at all?

Well, in that case there will be a lot of problems along the way. Taxpayers cannot file subsequent GST returns if GST for a month has not been filed. As per the law GST has to be filed under all circumstances and there is no excuse for not filing GST returns. Even if a particular taxpayer does not do any business or does not have any sales to show for a particular month, in that case also the said taxpayer has to file GST returns failing which there shall be imposition of penalties.

Notice and cancellation

In case a particular taxpayer fails to file GST for two months or more, a notice known as GSTR-3A notice is issued by the authorities concerned. Upon the said notice, a period of 15 days is granted to the taxpayer for regularising the GST return filing by paying all the dues such as penalties etc. failing which the GST officer can assess the tax and penalties payable by the taxpayer and make the taxpayer pay the same immediately.

However, in case a taxpayer continues to default with the GST filing and does not pay heed to the notice issued by the GST authorities, the law has laid down provisions for cancellation of GST registration. The GST registration can be cancelled if a taxpayer does not file GST returns for a period of 6 months continuously.  Before the cancellation of GST registration, the taxpayer is granted on final opportunity to file GST returns and regularise the filing after making of the due payments and if the said taxpayer fails to do so, the GST registration is cancelled and the authorities can recover all the amount payable such as taxes, fines etc. from the taxpayer immediately.

Final word.

Late filing of GST returns not only affects and impacts the GST compliance rating score but also puts monetary burden on the taxpayer. It is therefore, important that taxpayers file the GST returns well within time and never miss the deadline.

About the Author:

Advocate Kohal Dev Sharma
Advocate Kohal Dev Sharma

Kohal Dev, is a lawyer by profession and has a penchant for writing and his ability to juggle several tasks at a time, in the most effective and efficient manner is something that allows him to deliver content fresh out of the box. His extensive experience in the field of Law, Finance, Real Estate and Marketing allows him to write some of the most amazing blogs and articles in exactly the way they are required to be done. When not at work, he can be found reading and of course, writing.

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