Govt caps late fee at Rs 500 for GST returns filed before Sept 30

Topics GST returns

For those filing for February to April this year, the late fee was waived off if they filed it before June 24 because of the outbreak of coronavirus
The government has capped the late fee charged on late GST filing at Rs 500 per return if filed before September 30 this year, and has made it zero for those with nil tax liability, in a bid to clear the ongoing mess in the GST system. Under previous provisions, even those eligible for nil tax were to cough up large amounts of  late fee.

Earlier, the late fee was Rs 200 per day, with a cap of Rs 10,000 per return. The late fee relates to filing of the form GSTR3B, or the summary input-output returns. 

Even those with nil liability may have late fee piled up. Nil liabilities are generally for those taxpayers who file returns quarterly. Even these return filers have got late fee amounting to lakhs of rupees under the previous provisions, as of on July 1, 2017, which is said to have created a mess in the system. 

For those filing for February to April this year, the late fee was waived off if they filed before June 24 because of the pandemic.


The cap of Rs 500 was given to those filing returns for May to July, provided they file their returns before September 30. This is also applicable to those who have not filed earlier returns, provided they file them before September 30.

"Various representations were received to give further relief in the late fee charged for the tax period of May 2020 to July 2020 and cleaning up of past pendency of return from July 2017 to January 2020," said the Central Board of Indirect Taxes and Customs in a statement. 

Besides, it said uniform late fee is simpler in design and easier to implement on the common automated teller, it said. 

Abhishek  Jain, tax partner at EY said,"The move should help encourage various businesses, who had defaulted in filing returns earlier, to file returns."

He said these concessions may be looked down by some as harmful measures for compliant taxpayers but these are imperative, especially for small and medium sized businesses.



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