Know GST NIL or Rs 500 late fees applicable for which Taxpayer?

The economic impact of the 2020 coronavirus pandemic in India has been largely disruptive. The lockdown though necessary has led to a disastrous impact on the economy. The Government of India announced a variety of measures to tackle the situation, from food security and extra funds for healthcare and for the states, to sector related incentives and tax deadline extensions. The CBIC has provided relaxations on the late fee provisions for the very same reason.

What do you mean by late fees under GST?

1. Every registered person under GST is required to file monthly or quarterly return and annual return within the due date depending upon the type of the taxpayer status.
2. However, if such a taxpayer fails to pay tax or file returns within the prescribed due date, he shall have to pay late fee along with interest on the late payment of GST.
3. Such a fee is charged for each day during which such a failure continues on the part of the registered taxpayer after the due date to file returns.
4. Late fees are also applicable on NIL Returns.

What are the late fees charged under GST prior to any exemption benefit?

Late fee of Rs 200 per day is charged for every day of delay in filing all kinds of GST Returns except Annual Returns. The law has fixed maximum late fees at Rs 5,000.

Relaxation provided by CBIC in Notification No. 52/2020 dated 24th June, 2020

As per Notification No. 52/2020 dated 24th June, 2020, CBIC waived/reduced late fees for the late filing of GSTR-3B returns for the period from July 2017 to January 2020, as follows-

1. If GST liability is Nil, and the GSTR-3B return is filed between 1st July, 2020 and 30th September, 2020, then the amount of late fees is waived
2. If the GST liability is not Nil, and the GSTR-3B return is filed between 1st July, 2020 and 30th September, 2020, then the amount of late fees stand waived in excess of Rs 500.

What are the due dates mentioned in Notification No. 52/2020 dated 24th June, 2020?

For tax period of February 2020, March 2020 and April 2020, taxpayers having an aggregate turnover of more than Rs 5 crores in the preceding financial year = Due date of GSTR 3B is 24.06.2020

Taxpayers having an aggregate turnover of up to Rs 5 crores in the preceding financial year, whose principal place of business is in the Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana or Andhra Pradesh or the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands and Lakshadweep

Taxpayers having an aggregate turnover of up to Rs 5 crores in the preceding financial year, whose principal place of business is in Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha or the Union territories of Jammu and Kashmir, Ladakh, Chandigarh and Delhi

CBIC has provided further benefit w.r.t late fees in Notification No. 57/2020 dated 30th June, 2020

As per Notification No. 57/2020 dated 30th June, 2020, The maximum late fee is capped at Rs 500 per return, for the below mentioned tax periods, filed after the deadlines given in notification 52/2020 but before 30th September 2020.

1. For turnover more than Rs 5 crore: May 2020 – July 2020
2. For turnover equal to or below Rs 5 crore: February 2020 – July 2020

There shall be no late fee for nil returns filed up to 30th September, 2020

What about taxpayers whose registrations have been cancelled due to non-filing of GST returns?

Such taxpayers whose registrations have been cancelled due to non-filing of returns, may now apply for revocation of cancellation of their GST Registration and then file their pending returns by September 2020 for all cases where registrations have been cancelled till 12th June, 2020.

This relief provided by CBIC has a dual benefit namely, to clear the backlog of returns and to impart some working capital relief to the taxpayers which will be a welcome benefit for the taxpayers amidst the COVID 19 crises.