GST Return filing late fee upper limit reduced

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Recently RTI reveals CBIC Collects late fee penalties aggregate of hundred crores, which clearly signifies that taxpayers face many difficulties in timely GST return filing compliances.

Now considering the complexity in GST compliances and business losses due to covid pandemic, The 43rd GST Council Meeting was held at New Delhi on 28th May 2020 announced some relief measures for taxpayers

The meeting was held via video conferencing and It introduced rationalization of Late fee Imposed u/s 47 of GST Act along with Amnesty Scheme to give some respite to the taxpayers.

Let’s read about the government’s decision in the GST Council’s 43rd meeting in detail.

Late fee for delay in filing form GSTR-3B and GSTR-1 capped

The upper limit on the late filing fees has been lowered to reduce the burden of late fees for small taxpayers. The late fee is now subject to tax liability or taxpayers’ turnover.

For taxpayers having nil tax liability in GSTR-3B or nil outward supplies in GSTR-1 –

  • The late fee will be capped at Rs 500 (Rs 250 CGST + Rs 250 SGST)

For Other Taxpayers, If Annual Aggregate Turnover (AATO) in the previous year is-

  • Up to Rs. 1.5 crores, the maximum late fee shall be Rs. 2,000 (Rs. 1,000 CGST+1000 SGST),
  • Between Rs. 1.5 crores to Rs. 5 crores, the maximum late fee shall be Rs. 5,000 (Rs. 2,500 CGST+2500 SGST),
  • Over Rs. 5 crores, the maximum late fee shall be Rs. 10,000 ( Rs. 5,000 CGST+5,000 SGST).

Late fee for late filing GSTR-4 by the composition taxpayers shall be capped at –

  • Rs. 500 (250 CGST + 250 SGST) per return, in case of nil return; and
  • Rs. 2,000 (1000 CGST + 1000 SGST) per return for others.

Late fee payable for late filing GSTR-7 to be reduced –

  • Rs.50/- per day (Rs. 25 CGST + Rs 25 SGST) and to be capped to a maximum of ₹2,000/- (1,000 CGST + 1,000 SGST) per return.

Important Note – All the above proposals to be made applicable for prospective tax periods (June 2021 onwards).

COVID19 related relief measures for GST taxpayers

If you want any other guidance related to GST Registration or GST Return filing, please feel free to talk to our business advisors at 8881-069-069.

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COVID19 related relief measures for GST taxpayers

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