As we gradually move into 2024, the taxation landscape in India continues to be significantly impacted by the Goods and Services Tax (GST). Introduced in 2017, GST has revolutionized the Indian taxation system by replacing numerous indirect taxes with a unified system. However, four years down the lane, many businesses and taxpayers still grapple with the complexities of the GST return filing process. To help, we have compiled some expert tips to make the GST return filing process in 2024 more manageable.
Understanding GST and GST Returns
Firstly, a basic understanding of GST and GST return is crucial. GST is a comprehensive multistage tax levied on every value addition, whether it’s a service or a product. On the other hand, a GST return is a document featuring the details of income that a taxpayer is required to file with the tax administrative authorities. This data is used to calculate tax liability.
In layman’s terms, a GST return is a document that has all the details of your sales, purchases, output GST (on sales), and input tax credit (GST paid on purchases). As a registered dealer, you should be conversant with the three types of GST returns – GSTR 1, GSTR 2, and GSTR 3.
Streamline Record-Keeping
Precise and efficient record-keeping is the cornerstone of smooth GST return filing. The records should contain details about the supply of goods and services, GST paid and collected, and the GST credit utilized or claimed. This structured data will ensure that GST return preparation and filing is completed accurately and on time.
Utilise Online Tools
With delays and inaccuracies being expensive, organizations need smart solutions that ensure efficiency and consistency. The GSTN (Goods and Services Tax Network) provides a wide range of online tools and resources to help taxpayers navigate the GST return filing process. These resources, coupled with the growing list of authorized GST Suvidha Providers (GSPs), offer innovative solutions that simplify GST compliance.
Stay Updated with GSTN Notifications
Notifications and circulars are regularly issued by the GSTN and the Central Board of Indirect Taxes and Customs (CBIC). These updates often carry crucial changes in the GST filing process, due dates, and penalty provisions. It is recommended that taxpayers review these notifications regularly to ensure all changes are incorporated into their GST returns.
Ensure Accurate Calculation of Input Tax Credit (ITC)
ITC is a critical component of a GST return, as it allows a taxpayer to reduce the GST paid on purchases from the GST payable on output (sales). To claim ITC accurately, businesses must ensure that their suppliers have also filed their GST returns and paid taxes.
Automate the Process
With GST returns required to be filed monthly, quarterly, or annually (based on business type), it’s a mammoth task for businesses to keep up. Automating the GST return filing process can drastically reduce the time and effort required. It will also help to avoid errors or discrepancies in the filing process.
Seek Professional Assistance
The continuously evolving GST laws may pose a challenge for businesses. Engaging professionals who have expertise in GST rules, regulations, and updates can help avoid potential risks and penalties. Professionals can also assist businesses in understanding various exemptions, deductions, and credits that can lower their GST liability.
Be Prepared for Audits and Assessments
GST law mandates audits and assessments to verify the correctness of the GST return filed. Therefore, businesses should always keep their documents in order and readily available for audits. Proper documentation and quick response to audit queries can save businesses from heavy penalties and prosecution.
In conclusion, GST return filing can be a simple process if you stay updated, keep all your records in order, and utilise professional help if needed. Automation of the procedure and making use of the GSTN net services can drastically reduce the chances of errors. Ensuring that your Input Tax Credit is calculated correctly can also provide significant relief from the GST payable by your business. With these expert tips, you can navigate the GST return filing process of 2024 with ease and precision.