GSTN will soon introduce interest calculation facility in the monthly tax payment form GSTR-3B. Further, the tax authorities will give reasonable time to the businessmen to explain the difference in the turnover shown in the sales return GSTR-1 and the reason for the discrepancy in tax payment Form 3B before initiating recovery action on account of underpayment or non-payment of tax.
New Delhi: GST Network (GSTN) will soon introduce interest calculation facility in the monthly tax payment form GSTR-3B to help the taxpayers. This will enable taxpayers to calculate interest for delayed tax payment. GSTN, which provides technology network for indirect tax regime, said in an advisory that through this new facility, minimum interest will be calculated based on the amount declared by the taxpayers for the particular tax period in GSTR-3B.
In order to facilitate the taxpayers to make their own assessment, a new system of interest calculator is being provided in GSTR-B, it said. Through this, taxpayers will be able to calculate the interest on delay in filing the return.
As per the Goods and Services Tax (GST) Act, failure to pay the tax on time attracts 18 per cent interest. At the same time, an interest of 24 per cent is levied on non-reasonable or excess claim for Input Tax Credit (ITC). It was said in the consultation that this facility will be available soon on the GST portal and this will make filing of returns easier.
‘Adequate time’ to explain the reason for discrepancy in GSTR-1, 3B before recovery
Further, the tax authorities will give reasonable time to the businessmen to explain the difference in the turnover shown in the sales return GSTR-1 and the reason for the discrepancy in tax payment Form 3B before initiating recovery action on account of underpayment or non-payment of tax. The Central Board of Indirect Taxes and Customs (CBIC) has issued guidelines regarding recovery action, saying tax authorities will give “reasonable time” to traders to explain the reasons for such discrepancies.
As per the changes in the GST law with effect from January 1, tax authorities were allowed to initiate recovery action directly against those businesses which had shown excess sales in monthly return GSTR-1, but found the same in GSTR-3B during tax payment. not mentioned.
The move was aimed at curbing fake billing. Through bogus billing, sellers used to show excess sales in GSTR-1, so that the buyer could claim Input Tax Credit (ITC), while GST liability was reduced by showing under-sales in GSTR-3B. Till now, under the GST law, in such cases, first show cause notice was issued, and the process of recovery was started.
