Amnesty Scheme Extended for GSTR-1 Non-Filers

The government has extended the last date for the GSTR-1 amnesty scheme to January 17, 2020, from the earlier date of January 10, 2020.

Last month, the GST Council recommended, at its 38th meeting, providing this scheme for GSTR-1 non-filers since GST inception. The amnesty scheme provides a waiver of the late fee of GSTR-1 for the period July 2017 to November 2019. The condition attached is that the returns should be filed by the notified last date which is now extended.

The response to this amnesty scheme has been very positive, and the number of GSTR-1 returns filed was more than double. The average number of monthly GSTR-1 filed were seen to be about 25 lakhs in the past. But since its announcement on December 18, 2019, until January 9, 2029, about 54 lakh GSTR-1 returns have been submitted.

In the view of such an enormous response that would serve as a reduction in unmatched tax credits between returns, more time limit is definitely a welcome move. Also, with the annual returns in GSTR-9 and GSTR-9C extended till the end of January 2020, it provides sufficient time for taxpayers to make a correct and mindful declaration in their return.

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The GSTR-1 contains details of outward supplies made during a specific month/quarter. The details in sellers’ GSTR-1 auto-populates to GSTR-2A. The GSTR-2A helps their GST registered buyers to get the details of Input Tax Credit (ITC). 

Initial GST days saw several instances of non-compliance due to lack of legal clarity, frequent modifications, GSTN portal issues, etc. Therefore, an amnesty scheme was launched that could encourage genuine non-filers to come out and complete their pending non-compliance without fear of penal consequences was introduced.

There are approximately 25 lakh Nil return filing assessees, while an average of 10% of assesses has never reported till date. These taxpayers are not giving additional work to the tax system. Through this amnesty scheme, taxpayers can minimise their compliance costs and at the same time, reduce the pressure on the GST Network.

For any clarifications/feedback on the topic, please contact the writer at dvsr.anjaneyulu@cleartax.in