The Goods and Service Tax (GST) was first introduced in India on July 01, 2007. Ever since, there have been several amendments and updates to improve the process of GST application on goods and services. The government is also bringing about many changes to the GST portal so that taxpayers can use the online GST filing mechanism with the utmost ease and convenience.
The collection of taxes through GST has been growing as the government is trying to widen its tax base and more taxpayers are getting themselves registered for GST in order to avail its benefits.
Some latest and important updates in GST that the government has announced for companies and taxpayers are as below:
1. Extension of 4 weeks for fillings Tran 1 and Tran 2 forms (September 03, 2022)
The Supreme Court has granted a further extension to open the GST common portal for 4 weeks in order to fill forms Tran 1 and Tran 2 avail transitional credit w.e.f October 01, 2022.
2. E-invoicing limits to be reduced from Rs.20 crores to Rs.10 crores from October 01, 2022
Currently, E- invoicing is mandatory for businesses whose turnover exceeds Rs. 20 crores. However, the CBIC has notified vide its circular no 17/2022- central tax dated. 01.08.2022 that it seeks to implement mandatory e-invoicing from October 01, 2022 for businesses whose turnover exceeds Rs.10 crores in any financial year from 2017 – 2018 onwards.
3. Employee related transactions
– Any gifts whose value is above Rs.50,000 given without any consideration for furtherance of business would be subjected to GST
– Supply of goods under a contractual agreement entered by the employer and the employee will not be liable for GST
– GST is not applicable if an employer has given free housing to employees as a part of a contract between the employer and the employee, i.e., as a part of remuneration (CTC-cost to company)
– No Input Tax Credit (ITC) is allowed for free services provided by the employer to its employees, such as club membership, health and fitness center.
– An employee cannot demand a gift from the employer as a right and move to the court for the same.
4. HSN codes in GSTR- 1 (July 20, 2022)
– For taxpayers whose aggregate annual turnover is up to Rs. 5 crores are mandatorily required to report 2- digit HSN code for goods and services supplied.
– For taxpayers whose aggregate annual turnover is above Rs. 5 crores are mandatorily required to report 6- digit HSN code for goods and services supplied from August 01, 2022.
5. Use of Document Identification number (DIN)
The Supreme court has directed the GST council and Union of state to issue an advisory to all states to use DIN on all GST related notices, communications and documents to provide authenticity to the documents.
6. Some technical changes to the GST portal for ease of reporting to taxpayers are
A) New changes in Table 4 of GSTR 3B- Input Tax Credit (ITC) (September 02, 2022)
Changes have been made in Table 4 of GSTR 3B for reporting information about ITC availed, ITC reversal and ineligible ITC. Tax payers are advised to furnish all information correctly in the new format on the portal for the period August, 2022 onwards.
Detailed advisory has been provided where the new fields are depicted in red font. Click here
B) Single click Nil filing of GSTR-1 (August 02, 2022)
To improve the performance of filing GSTR-1 and to provide ease to users, a Nil return GSTR-1 form is available on the GST portal dashboard. Any user who intends to file a NIL GST return has to just click on the checkbox and the Nil return will be filed.
Nil return applies to the taxpayers who have:
- No Outward supplies
- No debit/ credit notes
- No advances received for any services
- No amendments to be made for any supplies
Steps to be followed to file a NIL GSTR-1 are provided here
C) New table 3.1.1 added in GSTR 3B (July 20, 2022):
The Electronic commerce operators (EOC) have to pay GST on passenger transport services, accommodation services, housekeeping and restaurant services as per Section 9(5) of the CGST Act, 2017.
Those EOC’s who provide the above services can now report all the information of the supply in the newly added table 3.1.1 while filing GSTR- 3B from August 01, 2022.
Detailed advisory on the contents on the table are provided here
D) Removal of negative balances in cash ledgers for composition taxpayers (July 08, 2022)
The cash ledger of some composite taxpayers becomes negative on reversal of amount leading to a negative cash balance. The government has now decided to nullify such negative balances.
The government is still in the process of bringing new amendments and changes in the GST and taxpayers need to be updated on the same in order to comply with the changes as well as utilize the benefits of GST.
We are here to help
It is a daunting task for companies to keep track of all the latest updates while having pressing business issues at hand. Financial service providers, like Diligen, have a dedicated team of tax professionals and advisors who are fully updated with all the latest tax rules.
Diligen provides its clients with a wide range of customized and flexible tax solutions which are cost effective. They guide and assist their clients to file monthly GST returns, GST reconciliation and Annual GST returns on time to avoid penalties. Diligen is your go-to solution for hassle-free GST compliance.