The 43rd meeting of the GST Council on Friday continued to extend relief to taxpayers, particularly small taxpayers, who are worst-affected in the second wave of Covid pandemic sweeping the country.

As part of trade facilitation measures, the Council approved an amnesty scheme to provide relief to taxpayers regarding the late fee for pending returns.

It has been decided that late fee on returns to filed in form GSTR-3B for tax periods from July 2017 to April 2021 will be capped to a maximum of Rs 500 (Rs 250 each for CGST & SGST) per return for taxpayers, who did not have any tax liability for the said tax periods. Also, the late fee has been capped to a maximum of Rs 1,000 (Rs 500 each for CGST & SGST) per return for other taxpayers.

The reduced rate of the late fee would apply if GSTR-3B returns for these tax periods are furnished between June 1 and August 31, a Finance Ministry statement said.

In addition, to reduce the burden of late fee on smaller taxpayers, the upper cap of the late fee has been rationalised by the Council to align late fee with tax liability/turnover of the taxpayers.

Further, in addition to the relief measures already provided to the taxpayers following measures announced on May 1, the council decided that for small taxpayers (aggregate turnover up to Rs 5 crore), with regard to their March and April 2021 tax periods, no interest rate will be charged for first 15 days from the due date of furnishing the return in FORM GSTR-3B or filing of PMT-06 Challan, a reduced rate of 9 per cent thereafter for further 45 days and 30 days for March 2021 and April 2021, respectively.

For large taxpayers (aggregate turnover more than Rs 5 crore), a lower rate of interest at 9 per cent for the first 15 days after the due date of filing return in form GSTR-3B for the tax period May 2021 will be charged. Also, there will be a waiver of the late fee for delay in furnishing returns in form GSTR-3B for the tax period May 2021 for 15 days from the due date of furnishing it.

Covid-Related Relaxations

In addition to these compliance measures, the Council also extended certain other Covid-19 related relaxations including the extension of the due date of filing GSTR-1/IFF for May 2021 by 15 days, an extension of the due date of filing GSTR-4 for FY 2020-21 to July 31, 2021, and allowing filing of returns by companies using Electronic Verification Code (EVC), instead of Digital Signature Certificate (DSC) till August 31, 2021.

Moreover, the time limit for completion of various actions, by any authority or by any person, under the GST Act, which falls during the period from April 15, 2021, to June 29, 2021, has been extended up to June 30, 2021, subject to some exceptions.

The Finance Ministry statement said that the Council also approved simplification of procedures for the filing of annual GST returns for FY21. Amendments in Sections 35 and 44 of the CGST Act made through Finance Act 2021 will be notified. This would ease the compliance requirement in furnishing reconciliation statement in form GSTR-9C, as taxpayers would be able to self-certify the reconciliation statement, instead of getting it certified by chartered accountants.

Besides, the filing of annual return in form GSTR-9/9A for FY 2020-21 to be optional for taxpayers having aggregate annual turnover up to Rs 2 crore, and the reconciliation statement in form GSTR-9C for the FY 2020-21 will be required to be filed by taxpayers with annual aggregate turnover above Rs 5 crore.

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