IT department Delays GST and GAAR reporting till March 2020

The IT department in India deferred the requirement for companies to provide information such as the details on GST and GAAR (General Anti-Avoidance Rules) in their tax audit report. This incident took place for the second time.

The need to provide these details in the report are kept in abeyance till 31 March 2020. This simply means that the tax audit reports do not have to provide details on GAAR and GST till March 31, 2020.

The due date for filing the report is September 30. But if you are covered under the transfer pricing provisions, then the due date is November 30.

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Professionals with gross receipts of over Rs 50 lakh and business entities with a turnover exceeding Rs 1 crore or Rs 2 crore (only if they have chosen presumptive taxation) are required to comply with the audit requirements.

The Central Board of Direct Taxes (CBDT) announced that they have received notification that the execution of reporting requirements under clause 44 (GAAR) and clause 30C (GST) of the Form No. 3CD might be deferred.

The IT department seeks these details to prevent companies from routing transactions via other countries to avoid taxes. These changes were supposed to come into effect on 20 August 2019. However, the stakeholders complained that the changes are a burden on companies and onerous.

As a result, the CBDT deferred the implementation of such changes in the audit form till 31 March 2019. Now, the implementation is postponed again till March 31, 2020.

Amit Maheshwari from Ashok Maheshwary & Associates LLP Partner said that this delay comes as a relief to the tax auditors due to the lack of clarity in the clauses. The requirements are difficult to comply with and the practitioners are not prepared.