GST return filing: GSTR-1

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With the GST becoming a reality in the coming year, it is necessary that the people understand the process, registrations and the filing of returns. While a lot has been talked about the GST in the media, we will try to cover the GST Return forms in a series of articles. The e-filing of the returns, that includes the three taxes- IGST, CGST and SGST, is to be done periodically as suggested by the Joint committee on the business process for GST. The proposal all moots the regular filing of the returns on particular dates of the next month: 10th for outward supplies, 15th for inward supplies, and 20th for monthly returns.

GSTR 1 : Outward supplies by registered GST taxpayers

A person who sells his goods or services to a client who is registered with the GST network then he is liable to classify his sales under specific codes. The HSN code or the Harmonized commodity description System and tariff Notification code is applicable to goods, while the Service Accounting Code or SAC is applicable for services. The HSN code will be of 4 digits and will be mandatory for taxpayers with an annual turnover of INR 5 Crores or more. In the 1st year of the GST, the turnover will be accepted on a self-declaration basis and from the next year the turnover of the previous year will be used as a basis for tax payment.

The HSN code of 2 digits will be used for taxpayers who have a turnover between INR 1.5 and 5 Crores in the previous financial year. This 2 digit code will be easy for taxpayers to use. For exports and imports, the HSN code will be in line with the international practice of following an 8 digit HSN code. The concept of the HSN code has been developed outside India and is followed by several countries where GST is already in progress.

It would be mandatory to mention the accounting codes for goods and services while submitting the relevant information in the returns that cater to invoice level information. The threshold for this information has been set for all the B2C inter-state supplies where the taxable value per invoice exceeds INR 2,50,000. In case, the value of invoices is below this value, the state-wise summary of supply statement will have to be filed. However, all invoices for the B2B transactions whether interstate or intrastate issued by the taxpayers will form a part of the GST return.

The GSTR-1 is nothing but a replica of a sales register of a company where the outward sales of goods and services are entered. It is meant for entering the detail data of sales. CGST and SGST will be applicable on the sales if the goods and services are sold to a person registered under GST within the state. IGST will be added if the sale is made to a registered person in another state.

3 thoughts on “GST return filing: GSTR-1

  • Hi, GSTR1, what about the accounting entries to be posted in the ledger. In the current scenario there is no linkage of credit availment. Post GSGT this will become mandatory.

    Regards.
    JB

  • Is the premise here that all B2B transactions will become input tax credits to the next tax payer in the chain, where as B2C transactions are the “final” sales? Is it therefore required to include a tax payer ID on the B2B transactions, which is why smaller transactions can be summarized for B2C?

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