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On which date late fee shall be applicable under GST? What is the scheme for reduction of late fee under GST? How can I reduce my unnecessary late fee liability under GST? |
What is late fee under GST?
According to section 47(2) of CGST Act, 2017 if a registered person fails to file his regular GST return on or before due date then he will be liable to pay late fee.
The amount of late fee vary as per the type of return filed, number of days delayed and due date of filing such return. Currently, the GST portal is aligned to charge a late fee only on returns GSTR-3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR-8, GSTR-7 and GSTR-9 only.
However, late fee is applicable on delayed filing of GSTR-1 also which may not be getting populated in the return but payable during assessments or on the basis of notice issued by authority.
On which date late fee shall be applicable under GST?
| Return | Name of the act | Late fees for every day of delay | Remarks |
| GSTR 9/10 | CGST | 100 | The GST law has fixed maximum late fees of ₹5000. This means that in any case, the maximum late fees that can be charged by government is ₹5000 each return being filed under each Act. |
| SGST | 100 | ||
| IGST | 200 | ||
| Other than GSTR 9/10 | CGST | 50 | The GST law has fixed maximum late fees of ₹10000. This means that in any case, the maximum late fees that can be charged by government is ₹10000 each return being filed under each Act. |
| SGST | 50 | ||
| IGST | 100 | ||
| Other than GSTR 9/10 (nil return) | CGST | 10 | id=”scheme”The GST law has fixed maximum late fees of ₹10000. This means that in any case, the maximum late fees that can be charged by government are ₹10000 each return being filed under each Act. |
| SGST | 10 | ||
| IGST | 20 |
What is the scheme for reduction of late fee under GST?
The government provided a relief to taxpayers by capping the maximum late fee on GSTR- 3B returns at ₹500. CBIC said that the government has decided the maximum late fee for filing GSTR-3B returns for the tax period of July 2017 to July 2020, given that such returns are filed before 30 September 2020.
Earlier, in the 40th GST council meet, Finance Minister Nirmala Sitharaman has announced a cap of ₹500 to be imposed as the late fee for filing GSTR-3B returns for the period of July 2017 to January 2020. Also, it was announced that there will be zero late fees for those with nil tax liability.
- Such relief is available only for Form GSTR 3B.
- No late fee in case of nil return.
- This scheme is applicable to all returns pertaining to the period of July 2017 to July 2020 when filed between 1st July, 2020 and 30th September, 2020.
- The Government capped the maximum late fee at ₹500 per return if there is tax liability.
How can I reduce my unnecessary late fee liability under GST?
- Always look out for any notifications currently in order during and file all the pending returns immediately (one such notification is the current one which caps the maximum penalty per return to ₹500).
- In case of any business which was registered but failed to file any return since the date of registration it is always advisable to apply for cancellation registration since the effective date of registration if no sales or purchases are made to avoid late fee. Such businesses need to file their GSTR 10 (final return) and can apply for new registration in case they want to start the businesses now.
- If in case of any business which failed to file returns for 6 continuous months after from a later date than effective date of registration (which means they have filed returns post registration but did not file the return for a later date as there are no sales or purchases. In such cases if your effective date of cancellation is any other date or current date then you can visit the office of assessing officer and ask him to cancel your GST registration from registration date for saving late fees. However, if you have made any GST sales or purchases then you should first file returns till the month in which you have last GST sales or purchase and then ask the assessing officer to cancel your GSTIN from that month so save GST late fee penalty.
- One should always keep checking the status of filing, in case the return filing is handled by a 3rd party or consultant. This can be checked from the GSTIN portal itself using the mentioned path.
Path gst.gov.in >>> search Tax payer >>> Search by GSTIN >>> Input your GSTIN >>> click on filing table. You can see filing dates for last 12 returns filed.
