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September 22, 2020

CBIC provides for late fee waiver in filing of GSTR 4 and GSTR 10

by CA Shivam Jaiswal in GST, GST Circular Notification

CBIC provides for late fee waiver in filing of GSTR 4 and GSTR 10

The economic impact of the 2020 coronavirus pandemic in India has been largely disruptive. The lockdown though necessary has led to a disastrous impact on the economy. The Government of India announced a variety of measures to tackle the situation, from food security and extra funds for healthcare and for the states, to sector related incentives and tax deadline extensions. The CBIC has provided relaxations on the late fee provisions for the very same reason.

What do you mean by late fees under GST?

  • Every registered person under GST is required to file monthly or quarterly return and annual return within the due date depending upon the type of the taxpayer status.
  • However, if such a taxpayer fails to pay tax or file returns within the prescribed due date, he shall have to pay late fee along with interest on the late payment of GST.
  • Such a fee is charged for each day during which such a failure continues on the part of the registered taxpayer after the due date to file returns.
  • Late fees are also applicable on NIL Returns.

Levy of late fees under GST

Section 47 of the CGST Act pertains to levy of late fees under GST. According to Section 47(1), Any registered person who fails to furnish the details of outward or inward supplies required under section 37 or section 38 or returns required under section 39 or section 45 by the due date shall pay a late fee of Rs 200 (Rs 100 under CGST and Rs 100 under SGST/UTGST) for every day during which such failure continues subject to a maximum amount of Rs 5000

As per Section 47(2), Any registered person who fails to furnish the return required under section 44 by the due date shall be liable to pay a late fee of Rs 200 (Rs 100 under CGST and Rs 100 under SGST/UTGST) for every day during which such failure continues subject to a maximum of an amount calculated at 0.25% of his turnover in the State or Union territory.

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CBIC waives off the late fee payable for failure to furnish FORM GSTR-10

The CBIC vide Notification No 68/2020 dated 21.09.2020, waived the amount of late fee payable under section 47 which was in excess of Rs 250, for the registered persons who failed to furnish the return in FORM GSTR-10 by the due date but furnished the said return from 22nd September, 2020 to 31st December, 2020.

A taxable person whose GST registration is cancelled or surrendered has to file a return in the form of GSTR-10. This return is called as final return. GSTR 10 must be filed within three months from the date of cancellation or date of cancellation order whichever is later. 

CBIC waives off the late fee payable for failure to furnish FORM GSTR-4

The CBIC vide Notification No 67/2020 dated 21.09.2020, waived the amount of late fee payable under section 47 which was in excess of Rs 250 and fully waived the late fee where the total amount of central tax payable in the said return was nil, for the registered persons who failed to furnish the return in FORM GSTR-4 for the quarters from July, 2017 to March, 2020 by the due date but furnished the said return from 22nd September, 2020 to 31st October, 2020.

A taxpayer opting for the Composition Scheme is required to file GSTR-4. It also covers the special composition scheme notified for the service providers vide the CGST (Rate) notification number 2/2019 dated 7th March 2020 with effect from FY 2019-20.  Form GSTR-4 (Annual Return) is to be filed on yearly basis. All the taxpayers must file the returns under form GSTR 4 till the 30th of the succeeding month after the end of the financial year. The government may extend the date.

CBIC earlier had also provided late fee waiver:

  • As per Notification No. 52/2020 dated 24th June, 2020, CBIC waived/reduced late fees for the late filing of GSTR-3B returns for the period from July 2017 to January 2020
  • As per Notification No. 57/2020 dated 30th June, 2020, the maximum late fee was capped at Rs 500 per return, for the mentioned tax periods, filed after the deadlines given in notification 52/2020 but before 30th September 2020.

This relief provided by CBIC has a dual benefit namely, to clear the backlog of returns and to impart some working capital relief to the taxpayers which will be a welcome benefit for the taxpayers amidst the COVID 19 crises.

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