GST: IT System & e-Invoicing to Implement from 1st Oct 2020

On Saturday, the GST Council asked Infosys to upgrade the IT system of GST by July 30, 2020, and extended the launch date of the e-invoicing system till September 30, 2020. Nandan Nilekani, the non-executive chairman of Infosys, suggested in a presentation that for the ease of roll-out of the new tax system, a progressive theme should be opted. He advised that the roll-out process should be started by resolving compliance-related issues first. He said that by doing so tax evasion and abuse of loopholes due to non-linking of forms GSTR 1 and GSTR 3 can be brought down.

Nandan briefed the 39th GST council meeting The 39th GST Council meeting has been concluded on 14th March 2020 in New Delhi in the chairmanship of Union finance minister Nirmala Sitharaman and other panel. Read More that the process of improving the IT systems’ taxpayer handling capacity from the current capacity of 1.5 lakh to 3 lakh, requires the set up of new and improved hardware, but the hardware procurement process is on a halt because of the outbreak of Corona-Virus. He demanded the council to give the time till 31 January 2020 to complete the task.

The council agreed to hire additional manpower, up to 60 persons, on time and material basis. The council also assured that proper approvals will be provided for the procurement of additional hardware and hiring the workers but asked Infosys to remove the technical glitches during the filing of returns instantly. The earlier date of 1 April 2020, for the launch of e-invoicing and new returns, was extended to 1 October 2020.

GST Annual Returns

Relaxation to the Micro, Small and Medium Scale Enterprises from submitting reconciliation statement in form GSTR-9C Get the easy guide to GSTR 9C along with complete online return filing process. GSTR 9C is a GST audit form for taxpayers having turnover more than 2 crores. Read More for the financial Year 2018-19 was also declared by the GST council. The relaxation was announced only for those MSMEs having an annual turnover of less than INR 5 Crores. The last date of filing the Reconciliation Statement and the annual returns for the financial year 2018-19 is extended to 30 June 2020 on which late fees will not be charged by the department for the MSMEs having an annual turnover of less than INR 2 Crores.

A partner at Deloitte India, MS Mani said that the idea of opting progressive method to introduce changes in the tax filing system will help the taxpayers to get accustomed to these changes gradually. “The concerted efforts to overcome the technology challenges faced by businesses in GST would result in more businesses coming under the ambit of GST,” he said. He also added that the changes to be brought in by April 1, 2020, will have created an extra burden in the businesses.

The partner at Shardul Amarchand Mangaldas & Co, Rajat Bose said that the introduction of e-invoicing Get to know about the new E-invoice generation system on government GST portal with applicability. The system mandates to generate e-invoice for every sale by a registered business. Read More and new return by October will provide enough time to the taxpayers for getting accustomed to the changes.

Interest on Delays in Payment

The council decided to relieve the businesses form the interest to be paid for the delays made in the payments of GST. The businessmen will be charged interest on the net cash tax liability with effect from July 1, 2017.

The Partner with NA Shah Associates, Parag Mehta said that substantial litigation was expected on the notices sent by the department of GST to collect interest on non-payment or late payments of GST heck out due dates of payment under GST for general and composition taxpayers in India. We have included penalty charges on late payment with interest. Read More. The council has decided to charge interest on the net cash tax liability instead of input tax credit that will reduce the amount of interest to be paid by the taxpayers. “This will almost nullify the recovery notices for interest amounting to ₹49,000 crore,” he said.