The introduction of GST in India streamlined the indirect tax system, integrating a variety of taxes into one single unit, making compliance easier, lessening the burden of tax on the consumers. Under this law, foreign businesses that wish to supply goods or services or both to India are required to register under GST and file the relative returns as specified under the law. The non-resident taxable persons must be well versed with the rules and regulations of registering and filing the returns under GST Act to be tax complaint as non-compliance can lead to penalties, fees and interest. Here we discuss in detail the applicability and registration requirements for non-resident taxpayers and filing GSTR-5 in India.
What is GSTR-5
All non-resident taxpayers registered under GST that carry out business in India are required to file form GSTR-5 on the GST portal either electronically or through a facilitation center notified by the tax authorities. GSTR-5 consists of details of all inward and outward supplies made and received by the taxpayer and he should pay the tax, interest, penalty, fees or any other amount payable under the act within the specified due date.
Due Dates for Filing GSTR-5
GSTR-5 has to be filed monthly within the 20th of the subsequent month when the registration extends for many months. If the registration is for a specific period, then the return has to be filed within seven days after the last day of the validity period of registration.
Late Fees and Penalty
If the GSTR-5 returns are not filed within the due date, they are liable to pay late fee at Rs.50/- per day and Rs.20/- per day for nil returns, subject to a maximum of Rs.5000/-. Interest is also charged at the rate of 18% per annum. The interest is calculated on the amount of outstanding tax, for the number of days from the due date of filing up to the date it is filed.
The penalty for non-payment and non-filing of GSTR-5 is the taxpayer is not allowed to file the return of the next month unless the current month’s return is filed.
Important Points to Note While Filing GSTR-5
- It is mandatory for all non-resident taxpayers registered under GST and engaged in providing supplies and services or both from another country in India, to file GSTR-5
- The details of inward and outward supplies are available in a single form.
- The due date for submission of GSTR-5 is the 20th of the subsequent month along with payment of tax, fees, penalty, interest for a specific tax period or seven days after the end of the validity period of registration for registrations for a short period.
- A late fee of Rs.50/- per day and Rs.20/- per day for nil returns, and interest at 18% per annum is applicable for late filing and non-filing of GSTR-5. Interest is applicable from the date the return is due up to the date on which it is filed.
- The amount of advance deposited by a non-resident taxpayer will be refunded only after the person has furnished all the returns required in respect of the entire period for which he has registered in GST. Refund can be applied in serial no. 13 of form GSTR-5.
Filing of GSTR-5
GSTR-5 can be accessed on the GST portal. The taxpayer has to login and then to services->returns->returns dashboard. In the File Returns Page, he has to select GSTR-5, and click on ‘Prepare Online’ button. The page for filing GSTR-5 is displayed. There are 14 tables in this form pertaining to relevant details for the taxpayer to enter.
- Tables 1 to 2- Taxpayer has to enter GSTIN; legal name or trade name of the business and the validity period of the registration, which are auto populated after GSTIN is entered.
- Table 3 is for inputs/capital goods received from overseas (import of goods), other details like bill of entry along with IGST, Cess paid, rate of tax and amount of ITC available.
- Table 4 is about amendments of any previous returns. Taxpayers can make changes in the earlier returns filed.
- Table 5 is for taxable supplies made to registered persons, with invoice wise details of B2B sales in India. This section along with the details of state, includes IGST/CGST & SGST and Cess.
- Table 6 is for taxable outward inter-state supplies to unregistered persons where the invoice value is more than 2.5 lakhs. It contains details of large scale B2C and inter-state sales to unregistered persons where invoice value is more than 2.5 lakhs.
- Table 7 covers details of intra-state and inter-state sales where the invoice value is less than 2.5 lakhs to unregistered dealers, other than the supplies mentioned in table 6.
- Table 8 is for amendments to taxable outward supply details furnished in returns of earlier tax periods pertaining to tables 5 and 6. It contains changes in previous months B2B and B2C large sales.
- Table 9 is for amendments to taxable outward supplies to unregistered persons furnished in earlier tax periods in table 7.
- Table 10 shows the total tax liability with details of tax liability on outward supplies for the current month, and additional tax to be paid due to the reversal of ITC on making changes in any imports of earlier months in table 4.
- Table 11 shows the tax payable and the tax that is paid. The details of IGST, CGST, SGST and Cess.
- Table 12 is for interest, late fee and any amount payable and paid. The table has details of late fee due, interest and late fee actually paid due to late filing.
- Table 13 gives the details of refund claimed from electronic cash ledger. The taxpayer has to select the bank account from a dropdown in which the non-resident taxpayer wants to receive the refund. The field is auto-populated if any refund amount received from electronic cash ledger.
- Table 14 consists of debit entries in electronic cash/ credit ledger for tax/interest payment (is populated after payment of tax and submission of return).
The final step is to verify the return. This has to be done by the authorized signatory who is a representative of the non-resident taxpayer in India with a valid PAN. After the filing process is completed, the status of GSTRN-5 return changes to ‘Filed’ and the taxpayer gets an SMS, if Indian mobile number is provided and email of the acknowledgement is also sent to them.
Frequently Asked Questions
- Is filing GSTR-5 compulsory?
Answer: Yes, GSTR-5 is a mandatory return and taxpayers who file these returns monthly, the return of the current month cannot be filed if the return of the previous month is not filed.
- How can a non-resident avail input tax credit?
Answer: Input tax credit is not allowed for non-resident taxpayers. He can avail the same if he registers as a normal taxpayer.
Also Read: GSTR-4 Due Date and Filing: A Complete Guide
GSTR-5 is an important return for non-resident taxpayers as it is a mandatory return and which contains all the details of their sales and purchases. The details from GSTR-5 of non-resident supplier are populated in GSTR-2 of the buyer. Late filing and non-filing can result in late fees and penalties. So the non-resident taxpayer should have a good knowledge of the GST filing process so that he can file the returns on time and stay tax complaint.