Guide to filing GST returns: Revenue secretary Hasmukh Adhia makes it easy for you

BY ECONOMICTIMES.COM | UPDATED: JUN 27, 2017, 04.37 PM IST

As the Goods and Services Tax (GST) moves closer to the launch date, July 1, anxiety is palpable. People, especially small traders and businesspersons, are scared of the complex procedure of filing multiple tax returns. 

Misconceptions about the GST returns have created a wrong impression of the complexity around it. But the fact is, filing of the GST returns is too simple to cause any anxiety. 

In a conversation with ET Now, Revenue Secretary Hasmukh Adhia dispelled confusion around GST returns. We break it all down to the basics for you. 

Those who need not bother at all about the details 

Nearly 80 per cent of all businesses will either not have to file any return or just once in three months. Yes, that's all. 

a) Those with a turnover below Rs 20 lakh need not file any return. Their life will not change at all after July 1. 

b) If your turnover is more than Rs 20 lakh and below Rs 75 lakh, you can plain ignore all the details. Why? Because you need to file just one return in three months—yes, just four returns in a year. And you need not give any details of invoices. If you opt for the composition scheme, you will deposit a lumpsum amount in tax without giving too many details to the government. You need to disclose just the total turnover. 

A large number of businesses will file just one return a month and that too without having to disclose invoices. If your turnover is more than Rs 75 lakh but you are B-to-C enterprise (business to consumer, which includes most of retail sector), you file one return—GSTR1—between 1st to 10th of the next month, giving only your total sales turnover and no other detail. 

Again, one return, but with two updates 

The remaining businesses will also file one return, but it will be updated twice. These are the only ones who will be required to furnish invoices. Such businesses will be only 10% to 20% of the total tax-paying busineses. Only this small minority needs to know all the rules. But even for them, it's simpler than what is understood. Here is what they will need to do: 

a) They have to file one return—GSTR-1—between the 1st and 10th of the next month by giving invoice details. 

b) The second return—GSTR-2—is actually not a return. It is a computer-generated account of all your invoices as furnished by your suppliers. You don't have to file any return but just confirm that all your business reflects in the GSTR-2.
GSTR-2 is not a return but the details of your purchases because of which you are going to get your input tax credit. GSTR-2 is not supposed to be filed by you. It gets generated when all your suppliers file their own GSTR-1. Thus it gets auto-generated by the system and you just need to approve it. 

c) GSTR3 too is not a return. It is a combination of GSTR-1 and GSTR-2 and is computer generated. It gives the summary of the total output tax liability, input tax credit and the difference between the two is the final tax liability for the month. It is for your viewing. If you find all your details correctly reflected, you just approve it. So, you file only one return, and the government will send you two computer-generated returns with additional information which you have to just check and approve. 

Adhia made an interesting point when he told ET Now that the confusion was due to the terminology. Referring to GSTR-1, GSTR-2 and GSTR-3, he said, "My only regret is I wish we would have named it as 1A, 1B, 1C." This, he thinks, would not have led to the impression that one has to file multiple returns. 

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