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Explaining GST Return

GST return is a document that shows the income and expenses of a taxpayer who is registered under GST law.

It is refer to the filing of a statement by a registered taxpayer containing the details of their sales, purchases, and tax paid as per the GST law.

It is a monthly or quarterly return depending upon taxpayer turnover. It is a way of communication of a taxpayer with the tax authorities to calculate how much tax the taxpayer owes or can claim as a refund.

There are two ways to file a GST return online and offline in both of these go with which suits you, there are many steps to filing a GST return firstly the taxpayer may contain all the accurate information about the sales and purchases.

These records should include information such as the GSTIN ( Goods and service tax identification number) of a supplier or customer. GST returns must be filled before the due date, which is the 15th of the month following the end of the relevant period.

If the return is filed late, the taxpayer will be liable to pay a penalty. The penalty for late filing of the GST return is 1% of the tax liability for each day of delay, up to a maximum of 30%. The penalty is reduced by 50% if the return is filed within 30 days of the due date.

Importance of GST Return

GST return is an official statement that states the record of registered taxpayer sales and purchases.

The importance of GST returns cannot be overstated. Here are some of the key reasons why it is important to file GST returns on time and accurately:

  • To calculate and pay the correct amount of tax. GST returns help the GST authorities to calculate the taxpayer’s tax liability.

If the returns are not filed correctly, the taxpayer may end up paying more or less tax than they should.

  • To maintain a good track record. GST returns are a good way to maintain a good track record with the GST authorities.

If the returns are filed on time and accurately, it shows that the taxpayer is compliant with the law. This can be helpful if the taxpayer ever needs to apply for a loan or other financial assistance.

  • To avail of input tax credit (ITC). ITC is a mechanism under GST that allows taxpayers to claim credit for the GST paid on their purchases.

This can help to reduce the taxpayer’s overall tax liability. In order to avail of ITC, the taxpayer must file GST returns correctly and on time.

  • To avoid penalties and interest. There are penalties and interest charges for late filing or incorrect filing of GST returns.

These penalties can be significant, so it is important to file the returns on time and accurately.

  • Another significant aspect of the GST return is its role in compliance. The GST laws and regulations are constantly evolving, and businesses need to stay updated and comply with these changes.

The GST return provides a mechanism for businesses to report their taxable activities and fulfill their compliance obligations.

Filing the GST return regularly ensures that businesses are adhering to the rules and regulations set by the government.

  • It helps in scrutinizing the relevant cases effectively and efficiently. GST returns enable the tax authorities to monitor and verify the transactions and tax payments of the taxpayers.

This helps in detecting frauds, errors, and discrepancies, and taking corrective actions.

  • To improve cash flow. GST returns can help to improve cash flow by allowing taxpayers to claim refunds for the excess ITC.

This can be especially helpful for businesses that have a lot of input taxes.

Filling GST returns is an important requirement for businesses and individuals registered under GST.


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