File any pending GST return now to avoid litigation and penalty as the GST department will time bar the return filings aif three years have passed from its due date

GST return filing time limit soon: No filing to be allowed after 3 years of due date, it's time to file any pending return

The Goods and Services Tax Network (GSTN) has issued a new advisory informing taxpayers that the GST portal will soon implement a change that prohibits filing specific GST returns after three years have elapsed since the due date. GSTN also mentioned that these changes, which involve restricting GST return submissions after three years, will take effect in the GST portal starting early next year (2025). Therefore, you are encouraged to review your tax records and submit any outstanding GST returns promptly if there are any that remain unfiled.

“As per the Finance Act,2023 (8 of 2023), dt. 31-03-2023, implemented w.e.f 01-10-2023 vide Notification No. 28/2023 – Central Tax dated 31th July, 2023, the taxpayers shall not be allowed file their GST returns after the expiry of a period of three years from the due date of furnishing the said return under Section 37 ( Outward Supply), Section 39 (payment of liability), Section 44 ( Annual Return) and Section 52 (Tax Collected at Source). These Sections cover GSTR-1, GSTR 3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR 7, GSTR 8 and GSTR 9. The said changes are going to be implemented in the GST portal from early next year (2025). Hence, the taxpayers are advised to reconcile their records and file their GST Returns as soon as possible if not filed till now,” said GSTN in an advisory dated October 29, 2024.

What will happen if you fail to act regarding this advisory?

Chartered Accountant Bimal Jain, founder, A2Z Taxcorp LLP, says that you will be considered a defaulter of GST law if you don’t file the mandated GST returns.

“This advisory is relevant for those taxpayers who wish to file any belated GST return and it relates to a period of three years from the due date of furnishing the said return. The GST department is being generous in giving taxpayers some more time to file their pending GST returns as this present advisory is in respect to an amendment implemented last year on October 1, 2023. This is a good advisory by GSTN and will help taxpayers save the trouble of GST tax demand notices, and other hassles that occur when a mandatory GST return is not submitted,” says Jain.

Jain says that a potential issue for taxpayers who fail to submit a late GST return and get time-barred by the GST portal is that the GST department might begin a best judgment assessment.

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“The GST department will source its information through its own sources, third party, your books of accounts and others and then pass a best judgement assessment order to the best of their abilities. Now this assessment can be a problem for taxpayers also. For example: after the best judgement assessment is over if the department finds that the taxpayer has any pending GST which is yet to be deposited then a tax demand notice will be issued,” says Jain.

This story originally appeared on: India Times - Author:Faqs of Insurances