GSTR 9 Annual Return: Turnover Limit, Last Date, Late Fee and Rules

GSTR 9 Annual Return: Turnover Limit, Last Date, Late Fee and Rules:  GSTR-9 is a yearly report that most businesses in the GST system need to submit. It’s like a summary of their entire year’s activities, showing what they said they did in their returns compared to what’s in their financial records. It has specific rules about when and how to submit it, and there are different versions for certain types of businesses, like those in special tax schemes or e-commerce. However, some government departments or local authorities audited by certain officials don’t have to file this yearly report.

In this article, we will delve into comprehensive details about GSTR-9. We’ll cover what GSTR-9 entails, its rules, due dates, penalties for non-filing, considerations for registration cancellation, and managing multiple GST registrations across states.

What is GSTR-9?

  • This is the Annual Return. It’s like a summary report of all the transactions a taxpayer made in a financial year related to GST. It includes details about sales, purchases, input tax credits, and tax payments.
  • GSTR-9 helps in checking if the taxes that a taxpayer is supposed to pay match with the taxes paid. It acts as a way to verify and reconcile the tax-related information for the year.

GSTR-9C

  • This is the Reconciliation Statement, designed to cross-check the information in GSTR-9 with the audited financial statements of the taxpayer.
  • GSTR-9C ensures that the financial records maintained by the taxpayer comply with the requirements under the GST law. It adds another layer of assurance by allowing the alignment of tax-related data with audited financial records.
  • GSTR-9C is a self-certified return, meaning the taxpayer confirms the accuracy of the information provided. This adds credibility to the compliance process.

Who Needs to File GSTR 9 and GSTR 9C (Annual Return)

Most registered businesses have to file an annual return called Form GSTR-9 (for regular taxpayers) or GSTR-9A (for composition taxpayers).

Aggregate Turnover GSTR-9 GSTR-9C GSTR-9A
Up to 2 Cr. Exempt NA Exempt
More than 2 Cr to 5 Cr Filing is Mandatory NA NA
More than 5 Cr. Filing is Mandatory  Filing is Mandatory

However, there are some exceptions like Input Service Distributors, specific taxpayers under different tax sections, casual taxable persons, non-resident taxable persons, and certain government departments whose audits are handled by specific authorities.

GSTR-9 Turnover Limit

Here’s a structured table of the requirements for filing GSTR-9, GSTR-9C, and CGSTR-9A based on Aggregate Turnover:

Aggregate Turnover GSTR-9 GSTR-9C GSTR-9A
Up to 2 Cr. Exempt NA Exempt
More than 2 Cr to 5 Cr Filing is Mandatory NA NA
More than 5 Cr. Filing is Mandatory  Filing is Mandatory

Based on Aggregate Turnover, businesses with turnover more than 2 Cr up to 5 Cr are mandated to file GSTR-9, while those exceeding 5 Cr have to file both GSTR-9 and GSTR-9C, while CGSTR-9A is exempt for all categories.

When to File GSTR 9?

This return needs to be submitted by the 31st of December after the end of the financial year through the online portal. Also, electronic commerce operators collecting tax at source have a different form called GSTR-9B.

Exemptions

The government has the power to exempt certain groups of registered people from filing annual returns. For instance, small businesses with turnovers up to Rs. 2 Crore were initially exempted from filing annual returns for financial years 2017-18, 2018-19, and 2019-20. However, for later years like 2020-21, 2021-22, and possibly 2022-23, these small businesses were exempted by the Commissioner through various notifications.

Multi-State GST: GSTR-9 at Rs. 2 Crores+

Now here questions arises, when does the requirement for filing the GSTR-9 annual return become mandatory for businesses operating with multiple registrations across different states? Let’s explore the answer step by step.

  1. Aggregate Turnover Definition:
    • Aggregate turnover means the total value of all taxable supplies (excluding certain specific supplies), exempt supplies, exports, and interstate supplies made by a person with the same PAN (Permanent Account Number). It’s calculated across all states in India but doesn’t include certain types of taxes.
  2. Applicability of GSTR-9 for Multiple State Registrations:
    • If someone has registered for GST in multiple states and the combined turnover from all these registrations exceeds Rs. 2 crores in a financial year, then they are required to file the annual return (GSTR-9).
  3. Mandatory Filing Requirement:
    • When the total turnover from all registered locations crosses Rs. 2 crores, filing the annual return becomes mandatory. This includes filing Nil returns for those specific GSTINs (GST Identification Numbers) that didn’t have any transactions during the year.
  4. Calculation at PAN Level:
    • The calculation considers the overall turnover across all registered locations connected to the same PAN. So, if the combined turnover from all these locations surpasses Rs. 2 crores, it mandates the filing of the annual return, even if certain locations had no transactions.

In summary, if someone has multiple GST registrations across different states and the total turnover from all these locations exceeds Rs. 2 crores, they must file the annual return, even for those locations with no transactions during the year.

Example: 

Suppose there’s a business, XYZ Pvt. Ltd., registered for GST in three different states: Punjab, Haryana, and Maharashtra. Each state has its own GSTIN (GST Identification Number), and the turnover from each state for a financial year is as follows:

Punjab: Rs. 1 crore

Haryana: Rs. 80 lakhs

Maharashtra: Rs. 50 lakhs

Now, let’s calculate the aggregate turnover for XYZ Pvt. Ltd. considering all three states:

Total Turnover = Turnover in Punjab + Turnover in Haryana + Turnover in Maharashtra Total Turnover = Rs. 1 crore + Rs. 80 lakhs + Rs. 50 lakhs Total Turnover = Rs. 2.3 crores

In this case:

Number of GST Registrations: XYZ Pvt. Ltd. has three GST registrations in Punjab, Haryana, and Maharashtra. Aggregate Turnover: The combined turnover from all three states is Rs. 2.3 crores. Applicability of GSTR-9: Since the total turnover (aggregate turnover) across all states exceeds Rs. 2 crores, XYZ Pvt. Ltd. is required to file the annual return (GSTR-9) for the financial year. Even if Haryana or Maharashtra had no transactions during the year or had transactions below the taxable threshold, the combined turnover from all states determines the obligation to file the annual return if it surpasses the specified threshold of Rs. 2 crores. So, The company need to file GSTR-9 for each state.

GSTR 9 or 9C in Case of Cancellation of GST Registration

  1. Cancellation of GST Registration:
    • When a business cancels its registration under the GST law, it doesn’t mean they’re exempt from fulfilling its obligations for the period before the cancellation date.
  2. Liability for Period Before Cancellation:
    • Even if a business cancels its GST registration, it’s still responsible for meeting its obligations under the GST law for any period before the cancellation date.
  3. Requirement to File GSTR-9 after Cancellation:
    • Despite cancelling the registration during a financial year, it’s clarified that the business still needs to file the annual return (GSTR-9) for that financial year.
  4. Obligations Remain:
    • The FAQ on the official GST website (www.gst.gov.in) affirms that filing the annual return is necessary, regardless of the cancellation of registration within the financial year.

In essence, even if a business cancels its GST registration during a financial year, they’re still obliged to file the annual return (GSTR-9/9C) for that year, ensuring compliance with GST regulations for the period before the cancellation.

Consequences of Non-filing or Late Filing of FORM GSTR-9

Consequences Description
Notice Issuance for Non-filing Tax authorities can issue FORM GSTR-3A within 15 days to compel required GSTR-9/9C filing.
Late Filing Penalties Late fees were initially set at Rs. 100/day, maxing at 0.25% of turnover, exempted partially for some per CBIC 2023 notification. For turnover ≤ Rs. 5 cr: Rs. 25/day capped at 0.02%. Turnover > Rs. 5 cr ≤ Rs. 20 cr: Rs. 50/day capped at 0.02%. There is no late fee for Nil GSTR-9.
General Penalty Provision Section 125 of the CGST Act allows penalties up to Rs. 25,000 each in CGST & SGST for non-filing contraventions without separately specified penalties.
  1. Notice Issuance for Non-filing:
    • If a registered person fails to file their GSTR-9/9C return, the tax authorities have the right to issue a notice (FORM GSTR-3A) within 15 days, compelling them to submit the required returns.
  2. Late Filing Penalties:
    • For delayed filing of the annual return (GSTR-9/9C), late fees are levied. Initially set at Rs. 100 per day of delay, it can reach a maximum of 0.25% of the turnover in the State or Union Territory. For some taxpayers, the late fee was partially exempted by a CBIC notification in 2023.
    • Specifically:
      • For those with an aggregate turnover up to Rs. 5 crores, the late fee is Rs. 25 per day, capped at 0.02% of the turnover.
      • For those with an aggregate turnover of more than Rs. 5 crores up to Rs. 20 crores, the late fee is Rs. 50 per day, capped at 0.02% of the turnover.
  3. General Penalty Provision:
    • Section 125 of the CGST Act allows for a penalty of up to Rs. 25,000 each in CGST & SGST for contravention of any provision of the act or related rules where no separate penalty is specified. This penalty may be imposed for non-filing of FORM GSTR-9/9C.

In essence, not filing or late filing of GSTR-9/9C can lead to notices being issued, late filing fees, and even general penalties as specified by the GST law. However, specific exemptions or reduced penalties might apply based on the taxpayer’s aggregate turnover, as announced by the CBIC in certain cases.

Important Points for GSTR – 9 (GST Annual Returns)

Cancelled GSTIN and Annual Return: If someone’s GST registration gets cancelled during the year and their turnover was over 2 Crores, they still need to file the Annual Return unless they’ve already submitted the final return and completed the cancellation before March 31st of that financial year.

Composition Scheme Change Requires Both Forms: If a registered person switches in or out of the composition scheme, they need to file both Form GSTR-9 and GSTR-9A for the relevant periods.

No Revisions Allowed in Form GSTR-9: Once Form GSTR-9 is filed, no changes or revisions are permitted, so it’s crucial to ensure accuracy before submission.

Implications of Annual Return Declaration: The information provided in the Annual Return is very important. Any false information is considered an offense under the GST Law and might attract penalties. Tax authorities rely on this information during scrutiny, and any discrepancies or non-compliance could lead to legal actions.

Paying Identified Liability from Annual Return: If there’s any liability identified during the filing of the Annual GST Return, it can be paid to the government using Form GST DRC-03. However, this payment can only be made using the available amount in the GST Cash Ledger.

Importance of Form GSTR-9 and Managing GST Records.

The Form GSTR-9 is a comprehensive overview of a year’s business transactions, different from GSTR-1 (details of sales) and GSTR-3B (summary of sales and purchases with taxes). Ideally, all these records should align, but discrepancies might occur due to differences in accounting and GST criteria. If tax wasn’t paid, it must be declared and settled in the annual return. Excess tax paid can be refunded through Form GST RFD-01. However, you can’t adjust tax credits in the annual return. Maintaining accurate records as per the law is crucial as they validate transactions and link to business documents.

  1. Different Forms, Different Jobs: Form GSTR-9 is like a big summary of your whole year in business. Now, there are two other forms – GSTR-1 and GSTR-3B. GSTR-1 talks about what you sold (your outward supplies) in smaller periods, while GSTR-3B is like a summary of everything you sold and bought (your inward and outward supplies) in those periods, along with the taxes you paid.
  2. Keeping Things in Sync: Ideally, the info in GSTR-1, GSTR-3B, and the records you maintain as per the law should all match up. If they don’t, there might be two main reasons: either you didn’t pay enough tax to the government, or you paid too much.
  3. Why the Differences Happen: Sometimes, the way you keep your business accounts might not perfectly match what’s needed under the GST law. This can cause some differences in the numbers.
  4. The Solution: If you didn’t pay enough tax, you should declare that in your annual return and make up for it by paying the additional tax. On the flip side, if you paid too much tax, you can put that in your annual return too and apply for a refund if you’re eligible using Form GST RFD-01.
  5. No Changes to Tax Credits in Annual Return: Remember, you can’t fix or adjust any tax credits in the annual return. If you need to change something about your tax credits, there are separate forms (like Form GST DRC-03) for that.
  6. Why Records Matter: It’s super important to keep good records as required by the law. These records prove that your transactions really happened and they match up with the documents you give out in your business.

So, the bottom line is: to keep your records straight, make sure your reports match up, and use the right forms to fix any tax-related issues!

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