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GST – Relaxations in Interest Rate and Late Fee for February – April 2020 returns

In view of the spread of COVID-19 and challenges faced by taxpayers in meeting the compliance requirements, the Central Government has announced relief measures on certain matters related to GST to help taxpayers. In terms of Notification No 32/2020- Central Tax dtd 03.04.2020 & Notification No 31/2020 – Central Tax dtd 03.04.2020 Late fee and Interest has been waived subject to certain conditions.

It is important to note that due date of returns for February, March and April 2020 remains the same and if the conditions in these notifications are not met, the normal liability of late fee and interest will continue

In terms of Notification No 32/2020- Central Tax dtd 03.04.2020 the government has waived late fee on returns for February, March and April 2020 (to be filed in March, April and May respectively). It is important to note that the waiver is subject to the condition that returns for these months are filed within the specified date otherwise the late fee for the whole period will become payable.

Similarly, relaxation in interest rate has been introduced in terms of Notification No 31/2020 – Central Tax dtd 03.04.2020 on returns for the month of February, March and April. For taxpayers with turnover upto 5 crores, the government has waived interest payment. For taxpayers with turnover above 5 crore, full waiver of interest is given only for first 15 days from due date, after which interest at reduced rate of 9% p.a is applicable. It is important to note that the waiver is subject to the condition tax payment is made within the specified date, otherwise interest at full rate (of 18% p.a) will be payable.

The specified dates for taxpayer to file the returns are as follows. For taxpayers with aggregate turnover above 5 crore the GSTR-3B returns of February, March and April must be filed by 24.06.2020. For taxpayers with turnover more than 1.5 crore and upto 5 crore, the GSTR-3B returns of February and March must be filed by 29.06.2020 and of April by 30.06.2020. For taxpayers, with turnover upto 1.5 crore the GSTR-3B return of February must be filed by 30.06.2020, of March by 03.07.2020 and of April by 06.07.2020

(Contributed by Reshma Elza Roy)

Reference :

Notification 31/2020 Central Tax

Notification 32/2020 Central Tax

Circular 136/06/020 GST

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