facebook

12 Nov 2018Posted By: Mudit Handa


What is the Procedure and Criteria of TDS under GST?

With the sole aim of upgrading and enhancing the GST tax structure and combating the tax evasion malice, the GST department had decided to revive the provisions of Tax Deduction at Source (TDS) and Tax Collection at Source (TCS) through a notification, with effect from 1st October 2018.

While the provisions of TCS under GST were made effective from 20th September 2018 by the Central Board of Indirect Taxes and Customs (CBIC), the TDS mechanism was enacted under the GST from 1st October 2018.

Before discussing the procedure of tax deduction under GST, we must know about the concept of TDS under GST.

 

#1. What is the provision of TDS under GST?

The provisions for Tax Deduction at Source have been discussed u/s 51 of the CGST Act-2017.

As per section 51 of the CGST Act,

If the total value of the supplies under a contract is more than ₹2.5 lakhs, the tax shall be deducted @1% as CGST and 1% as SGST from the total value of the said taxable goods or services or both credited to the supplier or the ‘deductee’ having the GST registration.

 

#2. What is the procedure of TDS under GST?

There are specific parties that are designated to deduct TDS under GST. as a matter of fact, there are separate regulations of GST registration as well as GST return filing procedure for TDS deductors.

Know about the criteria for being a TDS deductor under GST.

Given below is the complete procedure of Tax Deduction at Source under GST-

  • Step 1: TDS Deduction

GST tax is deducted while crediting payment to the supplier. As discussed above, TDS is deducted @ 2% as IGST in case of interstate supply and in case of intrastate supply, TDS is deducted @ 1% as SGST and 1% as CGST.

 

  • Step 2: TDS payment to the government

Upon deduction, the TDS is supposed to be paid to the government within 10 days of the month end during which such TDS Deduction was done.

 

  • Step 3: TDS return filing

The concerned party that deducts tax under GST is now supposed to fulfil a separate GST return filing procedure. The Tax Deductors under GST is needed to file a TDS return under GST, which is referred to as FORM GSTR-7.

This GST return filing has to be completed and submitted within 10 days from the end of the month in which such GST deduction was made.

 

  • Step 4: TDS certificate

A TDS Deductor under GST is now supposed to furnish a system generated TDS certificate in the form of FORM GSTR-7A to the deductee within 5 days from the date when the amount of TDS under GST was credited to the government, i.e. when the GSTR-7 was filed.

 

#3. What if TDS deduction under GST is not timely credited?

The provisions of the penalty in case of late TDS deduction are given u/s 50(1) and 51(6) of the CGST Act-2017. In case of default in TDS deposit under GST, i.e. if the if the amount of the TDS deduction under GST is not timely credited to the government, an interest @18% per annum shall be chargeable on the Tax Deductor.

 

#4. What if the TDS return under GST not timely filed?

In case of late GST return filing for TDS deduction under GST, a late @ ₹100/- per day shall be applied separately as under CGST Act and SGST Act, which may be extended up to ₹5,000/-.

 

#5. What if the TDS certificate is not timely furnished?

In case of late furnishing of FORM GSTR-7A, i.e. TDS certificate under GST a Late fee @ ₹100/- per day shall be chargeable, from the day after the expiry of the 5 days period until such failure is resolved. The late fee shall be extended up to ₹5,000/-.

 

#6. What if an excess amount of TDS is deducted under GST?

In case an excess amount of TDS is deducted under GST, the TDS deductor or the deductee may claim the refund of the excess TDS amount deducted.

However, if excess TDS is credited to the deductee, the deductor can’t claim the TDS refund.

 

If you need any sort of assistance regarding GST registration or GST return filing procedure, feel free to contact our business advisor at 8881-069-069.

Now you can also Download E-Startup Mobile App and Never miss the latest updates relating to your business.

Give a Reply

Fill up the form

x
E-startupIndia Mobile App

GET E-STARTUP INDIA IN YOUR
pocket!

Download our free Android App and get realtime update on your order status.
Easily connect with our professionals handling your order over chat & mobile.
Never miss business compliances due date with advance notifications.

Get E-startupIndia in your mobile

Why Choose Us

e-startupindia member of GOOGLE

Serving business owners with an Average 4.8+ Google Rating.

e-startupindia certified #AxixBank

Trusted by Axis bank to cater its clients all licensing & compliance needs.

e-startupindia NG Alliance Partner

Providing lending solutions for business needs with NeoGrowth.

e-startupindia Google Partner

Open Neo bank account worldwide & provides cross-border remittance solutions.

e-startupindia member of CII

E-startupindia is a Proudly Member of Confederation of Indian Industry.The CII is a premier business association in India which works to create an environment.

e-startupindia certified #Etstartupindia

E-Startup India is duly certified under GOI's Startup India scheme and is renowned for our tech-driven solutions for business & legal services requirements for MSMEs.

e-startupindia Google Partner

E-Startup India is a Google Partner, which implies we are rigorously involved in assisting SME businesses to market their presence in the digital world.

Popular Services

Private Limited Company | Public Limited Company | One Person Company | Limited Liability Partnership | Partnership Firm | Sole Proprietorship Firm | Section 8 Company Registration | USA Company Registration | UK Company Registration | UAE Company Registration | Singapore Company Registration | Company Registration Hong Kong | Import Export Code | IEC Modification | AD Code Registration | Spice Board Registration | US FDA Certification | ISO 9001 2015 | ISO 14001 EMS | ISO 22000 FSMS | ISO 27001 ISMS | ISO 50001 Energy Management | ISO 45001 | ISO Surveillance | ISO Certification | MSME Registration | FSSAI Registration | Shop Establishment Registration | Barcode Registration | Coffee Board Registration | Startup India Certificate | ZED Certification | Trademark | Trademark Objection Reply | Trademark Opposition | Trademark Hearing | Trademark Formality Check Fail | Website Development | Patent | Copyright | Design Registration | Business Name Suggestion | Logo Designing | Trademark Assignment Service | GST Registration | GST Modification | GST Cancellation | GST Return Filing | GST Invoice Software | UIN Registration | Income Tax Return | Income Tax Notice | Income Tax Refund | Income Tax Assessment | TDS Return Filing | Form 15CA / CB | Professional Tax Registration | 12A and 80G Registration | FCRA Registration | CSR Registration | Project Report | Pitch Deck | Seed Fund Startup India | Accounting for Ecommerce | Virtual cfo services in india | Bookkeeping & Accounting | Private limited Company Annual Compliance | Form INC-22A | Form 15CA / CB | Company Strike Off | Commencement of Business | Fssai annual return | Online CA Consultancy | Income Tax Return Filling | LLP Annual Compliances | Form DIR-3 KYC | Virtual Office for Company Registration | Dubai Company Registration |

IN THE MEDIA

  • e-startupindia South Asia's Leading Multimedia News Agency
  • Business Standard
  • e-startupindia Outlook
  • e-startupindia Htmedia
  • e-startupindia Yahoo News
  • e-startupindia New Delhi Times
  • e-startupindia India.com
  • e-startupindia IBTN9

CONNECT WITH US