What is GSTR-3B?
GSTR-3B meaning: GSTR-3B is a summary tax return of supplies that the government has mandated for new businesses and businesses that have taken up GST recently. GSTR-3B has to be filed every month and the taxpayers should report their sales figures, ITC, and net payable tax in GSTR-3B.
Typically, small and medium enterprises (SMEs) prefer to do their accounting operations manually. This makes tax filing within the specified time limit difficult. To simplify filing tax returns for such companies, the Government of India introduced GSTR-3B.
Should you file GSTR-3B?
If you are registered under GST, you must file GSTR-3B. There are, however, certain exceptions to the rule. These persons do not have to file GSTR-3B:
- Taxpayers who have registered under the Composition Scheme
- Input service distributors
- OIDAR service suppliers who are non-resident Indians (NRIs)
- Taxable persons who are NRIs
When should you file GSTR-3B?
Taxpayers with a turnover of less than INR 5 crores annually should file GSTR-3B quarterly while others should file GSTR-3B monthly. The tax liability of all business owners will be automatically entered into GSTR-1 from GSTR-3B while filing tax returns.
From January 2020 onwards, GOI has introduced new due dates for GSTR-3B filing. If your turnover is more than INR 5 crore, the due date is the 20th of every month.
If your turnover is less than INR 5 crore, the due date is the 22nd of every month for business owners in some states (Chhattisgarh, Madhya Pradesh, Gujarat, Daman and Diu, Dadra and Nagar Haveli, Maharashtra, Karnataka, Goa, Lakshadweep, Kerala, Tamil Nadu, Puducherry, Andaman and Nicobar Islands, Telangana, and Andhra Pradesh) and the due date is 24th of every month in other states (Jammu and Kashmir, Ladakh, Himachal Pradesh, Punjab, Chandigarh, Uttarakhand, Haryana, Delhi, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand, and Odisha).
If a business owner has opted for the QRMP (Quarterly Return Filing and Monthly Payment of Taxes) scheme, the due date is the 22nd or 24th of the month after every quarter. The due date is decided according to the rules of the State or Union Territory the business runs from (as given above).
Points to remember while filing GSTR-3B
You must keep these points in mind while filing GSTR-3B:
- Business owners must pay taxes and file returns within the deadline
- Delayed payments can result in penalties
- If taxes are paid within the deadline but the GSTR-3B is filed after the deadline, there will be a late fee and penalty
- All taxpayers (including those not selecting the QRMP scheme) must pay tax and file GSTR-3B every month even if they file GSTR-1 quarterly
Is there any late fee or penalty for delayed payments?
If your payment is delayed, a late fee is charged as follows:
- INR 50 per day of delay
- INR 20 per day of delay for taxpayers who have zero tax liability
If the GST is not paid within the due date, an interest of 18% per annum is applicable on the outstanding tax amount.
Requirements for filing GSTR-3B
- If you file GSTR-1, GSTR-2, and GSTR-3, you must file GSTR-3B as well
- Filing GSTR-3B is a fully online process. You can file it by visiting the GST portal for GSTR-3B
- You can pay tax using both online and offline methods
- You will receive an OTP on your registered phone to verify your return. You can use an EVC (Electronic Verification Code) or a DSC (Digital Signature Certificate) of class 2 or higher
- You can file GSTR-3B using an Aadhar-based e-sign
How to file GSTR-3B Return?
- First, provide your name and GSTIN on the GSTR-3B form
- In section 3.1, you must enter the details of the sales and purchases that are liable for reverse charge
You should enter the total value (total value of the items + debit notes – credit notes + advance tax received) plus the different taxes for the following items:
- Sales supplies (zero-rated supplies such as exports, deemed exports, or sales made to SEZ units and developers)
- Sales supplies (other than zero-rated supplies including all taxable products and services)
- Other sales supplies (nil rates and exempted supplies. These are not the same. Nil-rated supplies are not taxed at the time of the sale. However, you can claim an input tax credit on them. Exempted supplies are not taxed at POS and you cannot claim an input tax credit on them.)
- Purchase supplies that are liable for reverse charge (includes transactions in which you pay taxes directly to the government on behalf of the supplier)
- Non-GST sales supplies such as fuel
- Cess applicable to industries such as automobiles. If your business is unrelated to such industries, you do not have to pay a cess.
- In section 3.2, you have to enter the details of inter-state sales to unregistered buyers, buyers under the Composition Scheme, and Unique Identification Number (UIN) holders
You should enter the details of supply location or the location of your customer along with the total taxable amount, and IGST for the following sales:
- Supplies made to unregistered customers
- Supplies made to Composition Scheme holders
- Supplies made to UIN holders such as:
- Agencies associated with the United Nations Organisation (UNO)
- Consulates and embassies of foreign countries
- Multilateral Financial Institutions included under the UNO Privileges and Immunities Act. 1947
- A person or a group of people who have got a UIN through the Commissioner
- Eligible ITC (Input Tax Credit)
You can calculate the final tax payment and credits according to your income tax credit (ITC). You must enter the following details under section 4:
- (A) ITC available (whether in full or part)
You must enter the tax amount needed to import your goods (1), services (2), inward supplies liable to reverse charge (excluding 1 and 2) (3), inward supplies from ISD (Input Service Distributors) (4), and all other ITC (5) not included in the other subsections of section 4A.
- (B) ITC Reversed
Enter the details of the goods and services that you have used for non-business purposes as per rules 42 and 43 of CGST Rules (1) and others (2). You cannot claim ITC against such goods and services as ITC can be claimed only against items that are used in the sale or for business purposes.
- (C) Net ITC Available (A) – (B)
This value is calculated by subtracting the reversed ITC (B) from the available ITC (A).
- Ineligible ITC
You have to enter the details of blocked credits in case of certain services. For example, if you have a transportation service that does not supply goods, you cannot claim ITC on it. Similarly, other sectors like food, health services, beauty services, etc. cannot claim ITC. You have to fill in the details as per section 17 (5) (1) and others (2).
- Values of exempt, nil-rated, and non-GST inward supplies
You have to enter the taxation details for all interstate and intrastate purchases. You can include supplies purchased from suppliers under the Composition Scheme, purchase of GST-exempt items, nil-rated items, or non-GST items.
Under section 5.1, you have to enter the details related to tax liabilities. You should enter under this section only if you have failed to comply with GST regulations and have an additional tax liability. You have to enter the interest and late fee on taxable supplies that may or may not have tax on reverse charge.
- Payment of tax
You have to pay the GST before you enter details in this section. It requires all the tax amounts paid under different headers (CGST, SGST, IGST, and cess). You also have to include the overall tax payable, tax paid through ITC, tax paid through TDS/TCS, and tax that was paid directly as cash, including late fee and penalty interest.
- TDS/TCS credit
When a customer collects tax at source, you can receive credit against it. If you have such credits during the last month, you can enter their details under this section.
Once you have filled in all these details, you can submit the GSTR-3B. You need to sign the GSTR-3B as an authorized taxpayer using a digital signature certificate (DSC) or Aadhar card e-sign.
Frequently Asked Questions on GSTR 3B
Does GSTR-3B require invoice matching?
When you file GSTR 3B, you are not required to match invoices. Nevertheless, if the total values of the purchases and sales you reported on GSTR-3B don’t match the values you reported on GSTR-1, GSTR-2, and GSTR-3 for the pertaining months, then you will have to pay the additional GST with a penalty.
Can GSTR-3B get revised?
No, you cannot revise GSTR 3B after filing it.
What are the penalties for failing to file GSTR 3B or for filing GSTR 3B late?
The late fees for filing GSTR 3B after the due date are:
Rs. 20 per day of delay for taxpayers that have a nil tax liability for the month
Rs. 50 per day of delay for taxpayers that have a tax liability for the month
If you don’t pay the GST amount after the due date, you must pay an interest of 18% per year. The interest is calculated from the day following the due date to the actual day of payment.
Should I file GSTR-3B even if I did no transactions in a month?
Yes, even if you do not have any transaction record for a month, you have to file GSTR-3B as you are a registered taxpayer.
How are GSTR-1 and GSTR-3B different?
GSTR-1 is a monthly/quarterly return filed by a taxpayer. GSTR-3B shows the supplies and purchases of a month along with GST, ITC, and reverse charge details.
Do I need to submit individual invoices for GSTR-3B?
No, you have to only submit a consolidated summary of your invoices for GSTR-3B.
If I have two GSTINs, can I file one GSTR-3B for both?
No, you have to file GSTR-3B separately for every GSTIN.
Should I match invoices in GSTR-3B?
No, there is no invoice matching in GSTR-3B. You only have to provide a consolidated summary for GSTR-3B.