Indirect Tax Alert: GST - Recommendations of the 42nd GST Council meeting

Changes with effect from 01 January 2021

• Due date of furnishing quarterly GSTR-1 by taxpayers to be revised to 13^th of the month succeeding the quarter.
• Auto-population of liability from own GSTR-1.
• Auto-population of input tax credit from suppliers’ GSTR-1 through the newly developed facility in FORM GSTR-2B for monthly filers.
• Small taxpayers having aggregate annual turnover less than INR 50mn will be allowed to file returns on a quarterly basis with monthly payments. Such quarterly taxpayers have an option to pay 35% of the net cash tax liability of the last quarter using an auto generated challan for the first two months of the quarter
• Refund to be paid/disbursed in a validated bank account linked with the PAN &Aadhaar of the registrant

Changes with effect from 01 April 2021

• Auto-population of input tax credit from suppliers’ GSTR-1 through the newly developed facility in FORM GSTR-2B for quarterly filers
• In order to ensure auto population of ITC and liability in GSTR-3B, FORM GSTR-1 would be mandatorily required to be filed before FORM GSTR3B
• Revised requirement of declaring HSN for goods and SAC for services in invoices

Others

• The present GSTR-1/3B return filing system to be extended till 31 March 2021 and the GST laws to be amended to make the GSTR-1/3B return filing system as the default return filing system.
• Various amendments to CGST rules, including the furnishing of Nil in FORM CMP-08 through SMS.
• Satellite launch services supplied by ISRO, Antrix Corporation Ltd. and NSIL would be exempted.
• Levy of Compensation Cess to be extended beyond the transition period of five years, for such period as may be required to meet the revenue gap.

Note: The Press release would be given effect to through Gazette notifications/ circulars which alone shall have force of law.

[ Press release dated 05 October 2020]