Due to the pandemic, businesses are having a difficult time staying afloat. To provide relief to struggling businesses, the Government has decided to implement relief measures such as relaxing GST compliance requirements.
To provide a clear understanding of the relief measures that are being implemented regarding GST, the Government has released a slew of notices. Here are the main relief measures that you need to know.
Circular Dated 6th May 2020
This circular was released by the CBIC to provide clarity on the extension of ITC-04 due date, the procedure for IBC-related processes, and the timeline for merchant exports.
The ITC-04 form under the GST needs to be filed every quarter by principal manufacturers. This form contains information regarding the goods sent or received from workers.
The CBIC has clarified that there is an extension on the due date for the Form ITC-04 for the January – March 2020 quarter. It is now extended till 30th June 2020.
In ordinary circumstances, a merchant exporter needs to export goods within ninety days from the date of invoice that has been raised by a registered supplier.
According to the circular, merchant exporters can now export such goods by 30th June 2020 if the completion of this ninety days timeline falls between 20th March 2020 to 29th June 2020.
Usually, an Insolvency Resolution Professional (IRP) needs to obtain a new GST registration for an entity that is undergoing CIRP. The IRP needs to complete this registration within thirty days of their appointment.
Now, such IRPs can obtain a GST registration by 30th June 2020 or within thirty days of their appointment, whichever happens to be later.
Secondly, an IRP need not obtain new registration under GST if the entity that is the corporate debtor has been filing GSTR-1 or GSTR – 3B for each tax period before their appointment.
Furthermore, an IRP only needs to obtain a single GST registration even if the professional is in charge of the CIRP changes. In case the professional is changed, they need to amend the authorized signatory details under the new GSTIN.
Circular dated 13th April 2020
This circular provides more clarity on the treatment of sales returns under GST, in cases where the tax invoices have already been issued. In the first type of cases, the supplier needs to issue a credit note and declare the said note under the GSTR – 1 and the GSTR – 3B of the relevant month when the credit note was provided.
All tax adjustments that are not possible under GSTR – 3B will be claimed as a refund under Form RFD – 01. You will need to choose the “Excess Payment of Tax if Any” category.
Furthermore, this circular says that any letter of undertaking that was issued for the financial year of 2019- 2020 will continue to be valid until a recent letter of commitment is granted for the fiscal year 2020 – 2021. Hence, any exporters who need to export without paying the Integrated Goods and Services Tax can now do so.
In their export documents, such exporters must quote their LUT numbers for reference. These exporters can now file their letters of undertaking at any time before 30th June 2020.
Any tax deducted at source (TDS) which was due to be deposited with the Government between 20th March 2020 and 29th June 2020, can now be filed by 30th June 2020. No interest on the TDS will be chargeable as long as the TDS has been deposited in compliance with the notice. Along with the TDS, the Form GSTR – 7 must also be filed.
These same rules will also apply to any Tax Collected at Source or TCS that may be collected under Section 52 of the CGST Act. Hence, any e-commerce operators who need to file their TCS also receive an extension on their deadline. Such operators need to remember that the Form GSTR – 8 must also be submitted with the TCS.
Additionally, this circular also clarified the position of those seeking an extension on the two-year limit for claiming a GST refund that will expire on 31st March 2020. This circular has clarified that such taxpayers must apply using Form RFD – 01. They must apply using the said Form before 30th June 2020 rather than 29th July 2020.
Due to these unprecedented times, the exact stance of GST laws may be very confusing for taxpayers to understand. Hence, these circulars are necessary to provide clarity on specific issues.
Check out how to make gst filing and gst certificate download benefits if you require more information on these areas. With the help of these relief measures, the states are gearing up to weather the adversities brought on by COVID-19.