GST tax demand not settled despite payment? New online form notified to help taxpayers adjust tax demand amount; here's how to do it This form will help you adjust tax demand amount already paid against a specific tax demand order
The Goods and Services Tax Network (GSTN) has introduced a new form, GST DRC-03A, now available on the GST portal. This form enables taxpayers to adjust the tax demand amounts they have already paid against a specific GST demand order. It is particularly beneficial for those who have made partial or full payments via the DRC-03 form and wish to align these payments with an existing GST demand order.#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;} US Election 2024
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For instance, if you have a pending GST demand order of Rs 200 and you've already made a payment of Rs 50 using the DRC-03 form, you can file DRC-03A to adjust that Rs 50 against the demand order. This way, your net tax liability will decrease to Rs 150.
If taxpayers did not use the designated payment method to settle their tax dues, the GSTN system failed to adjust these payments against their outstanding tax demands. However, with the introduction of this new form, it will now be much simpler for them to apply their payments toward settling their tax obligations.
"It has been observed that some taxpayers have paid the demanded amount vide DRC 07/DRC 08/MOV 09/MOV 11/APL 04 through DRC-03 instead of using payment facility 'Payment towards demand' available on GST portal. This led to a situation where demand has been paid by the taxpayer, however the demand is not closed in the electronic liability register. To address this issue, the government has notified a new form named GST DRC-03A…," said GSTN in an advisory dated November 5, 2024.
How to use GST DRC-03A form to adjust your GST demand payment
The GSTN has announced the availability of the new Form GST DRC-03A on the GST portal. This form allows users to adjust the amounts already paid through DRC-03 in relation to the corresponding demand order.
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GSTN said: "It is advised to the taxpayers to use the DRC-03A form to link the payment made via DRC-03 with the demand order. Only DRC-03 forms where the cause of payment is either 'Voluntary' or 'Others' can be used in the Form GST DRC-03A. Taxpayers will be required to enter the ARN of the DRC-03 along with the relevant demand order number on the portal. Upon entering the ARN and selecting the demand order number of any outstanding demand, the system will auto-populate relevant information of the DRC-03 form as well as from the specified demand order against which the payment is to be adjusted."
GSTN further said that once you file the DRC-03A form and the adjustment has been made in the system, the corresponding entries will automatically be posted in the taxpayer's liability ledger to reflect the updated status of GST demands.
"In case the taxpayer fails to file an application in FORM GST DRC-03A on the common portal, the proper officer may proceed to recover the amount payable as per provisions of section 78 and section 79 of CGST Act," said the Ministry of Finance via the Central Board of Indirect Taxes and Customs (CBIC) in a circular dated July 11, 2024.
"This is a good advisory by GSTN as it will help taxpayers who have already paid the GST demand amount, yet the GST portal is showing the amount as pending. This situation can occur due to various reasons like for example: a taxpayer paid Rs 1 lakh via DRC-03 form against a GST demand on an ad-hoc basis, but the tax demand order number was not quoted i.e. mismatch. The system in this situation cannot configure for which exact tax demand orders the taxpayer made this payment. This problem is now solved due to GST DRC-03A form," says chartered accountant Bimal Jain, founder, A2Z Taxcorp LLP.
For which taxpayers the new GST DRC-03A form may prove helpful
According to Jain, the new GST DRC-03A form may help the following taxpayers:Taxpayers who partially paid any GST demand amount and want to adjust it with a specific tax demand order,Taxpayers who paid a GST demand amount on ad-hoc basis without specifying a demand order number and now want to adjust it with a specific tax demand order,Taxpayers with unfavourable tax orders who want to file an appeal in the GST tribunal and hence want to prevent recovery by GST officials for tax demand."Since the GST appellate tribunal (GSTAT) is yet to be created, taxpayers who have lost any appeal against the tax demand order can't file further appeal in the GST tribunal. So, in this situation the GST officials will start recovery proceedings against the taxpayer for pending tax demand payment. For example, a GST tax demand order of Rs 100 has been passed against the taxpayer. Now the taxpayer files an appeal against this order with the commissioner of appeals. For filing this appeal, the taxpayer needs to pre-deposit 10% of the tax demand order i.e. Rs 10 in this example. Now suppose the commissioner of appeals passed the order against you. So now you can't file an appeal in GSTAT, what happens is the GST officials start recovery proceedings against you for 90% of the tax demand since you already pre-deposited 10% earlier. To prevent this situation taxpayers can now file GST DRC-03A form which will prevent recovery of the balance amount of pending tax demand until the time GSTAT passes an order mandating otherwise," says Jain.
He adds that you need to file GST DRC-03A form quoting the unfavourable order number for which you wish to file an appeal in GSTAT as and when it comes into force.
How to file GST DRC-03A form on the GST portal
According to the advisory by GSTN, here's a step-by-step guide on how to file GST DRC-03A form: Step 1: Login to the GST portal and click on services and then navigate to 'My Applications' under 'User Services' tab. The Form GST DERC-03A will be visible here. You have to enter the GST DRC-03 form number and click on the 'Search' button. Once the applicable DRC-03 form is found, fill in the following details:
Date of filing,Cause of payment,Period From & to,Form GST DRC-03 balance as on date
Goods and Services Tax.Source: GSTN AdvisoryStep 2: Select 'Demand Order No.' from the drop-down box. It will display all the outstanding demands against which payment has not been made. You have to select the relevant demand order number from this drop-down. On selection, the following details will be displayed:
Demand order date,Order typePeriod from & to,Demand outstanding as on dateOnce you finished cross checking the details click on 'ADJUSTMENT OF DEMAND'.
Goods and Services Tax.Source: GSTN Advisory#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}
This story originally appeared on: India Times - Author:Faqs of Insurances
