All normal and casual registered taxpayers making outward supplies of goods and services with a yearly revenue exceeding the specified threshold limit must register for GST. The registered individuals or entities must follow the procedures for tax collection, payment of the taxes collected to the government, and periodic return filing through the GST portal as part of the compliance process.
The GST returns cover sales, purchases, GST received and paid, and input tax credits claimed. Ensuring the correct person gets credit is possible by accurately filing returns. The GSTR-1 is one such important return that has details on every sale the business made in the tax year. A report on each transaction made under the sales category in the preceding month is included in this return. All registered taxpayers (apart from composition dealers, input service distributors, non-resident taxable individuals, and those required to collect TDS and TCS) must file GSTR-1 either monthly or quarterly, depending on their turnover.
What is GSTR-1?
All registered taxpayers are required by Section 37 of the CGST Act to provide information about outward supplies through the filing of GSTR-1. It is a monthly return that must be electronically filed on the government-provided GST portal and includes information on all outward supplies of goods and services. It needs to be submitted by the 10th of the following month, following the conclusion of the relevant tax month. GSTR-1 is the sales report or sales summary for taxpayers.
Information to be provided in GSTR-1
The details that the taxpayer has to provide while filing GSTR-1 are as follows:
- Invoice details of supplies to registered persons and summarize the details of supplies to unregistered persons.
- Invoice details of interstate supplies with invoice values greater than R.25000/-.
- Details of credit and debit notes issued by the supplier against invoices.
- Details of the export of goods and services, including deemed exports.
- Summary details of advances received related to future supply and their adjustment.
- Details of any amendments to the information reported in the above categories.
- Nil-rated, exempted, and non-GST supplies.
- HSN/SAC-wise summary of outward supplies.
Read more: Common errors and mistakes in GSTR-1 filing
Important points regarding GSTR-1
- Taxpayers cannot submit duplicate invoice series for a particular GSTIN in a particular financial year.
- There is no limit to the number of tax invoices in a particular tax period.
- The tax liability must be discharged at the time of filing GSTR-3B, which is the summarized return containing details of sales, purchases, ITC, and the tax liability during the month.
- Taxpayers can submit a single GSTR-1 for all branches of GSTIN in a state.
- Invoices for IGST, CGST, and UGST must be issued separately. Taxpayers must issue separate invoices for reverse charges.
- Taxpayers registered under the composition scheme must file GSTR-1 on a quarterly basis.
- Taxpayers have to declare the details of all taxable supplies effected through e-commerce, along with the GSTIN of the e-commerce provider, in the return in the nil-rated and exempt supply sections.
- Taxpayers can upload the invoice details at any time during the tax period, not just while filing the returns.
- Taxpayers can modify, add, or delete any number of times before submitting the GSTR-1 for the tax period. They can download the summary of sales in GSTR-1.
Generation of sales summary in GSTR-1
After entering all the details of sales in the return, the taxpayer can generate the summary by clicking on the ‘generate summary’ option provided in the portal. By clicking the ‘preview’ option, the taxpayer can view the summary to verify the correctness of the invoice details entered before submitting the return.
The HSN-wise summary of outward supplies in GSTR-1 will reflect the number of invoices added along with total value, total taxable value, and total tax liability.
Generating the sales summary is important to ensure that the supplier has collected accurate tax from the customers and has remitted the said tax to the government within the time specified under GST. Late payment or non-payment of tax will result in late fees and other penalties. It is also an important document for recipients to compute and claim their eligible input tax credit (ITC). Timely and accurate filing of GSTR-1 helps recipients claim the correct ITC.
Excel template for GSTR-1
An offline tool with an Excel template is provided by GSTN to help taxpayers when there are many invoices to be reported. It is part of GSTN’s attempt to make tax compliance easy and convenient for taxpayers. The Excel template can be easily downloaded from the GST portal and used by taxpayers to report all the invoice-related data accurately.
Businesses with numerous invoices in a tax period may find it difficult to upload the individual invoices. It is costly and time-consuming. In the offline facility, the invoices can be uploaded in bulk. In the returns offline tool, the taxpayer can add up to nineteen thousand-line items and upload them to the GST portal at a time. When there is more invoice data, the returns offline tool can be used multiple times to upload it. The uploaded invoice details can be edited in the GST portal through the returns offline tool before the return is submitted for processing. This tool can also be used to view and download data in GSTR-2A by recipients. The data in GSTR-2A is auto-populated based on the returns filed by the supplier in their respective GSTR.
Taxpayers can prepare separate Excel workbook templates with different names for different GSTINs. These different files can be imported into the returns offline tool and uploaded to the GST portal. Third-party accounting or billing software can be used for invoice generation. If the Excel file generated by the third party is in the same format as provided by GSTN’s Excel workbook, the same can be uploaded. Otherwise, the third-party accounting software can generate the details in .CSV format, which can be imported into the offline tool. The CSV is a comma-separated value format. The JSON file generated through the returns offline tool can be uploaded to the GST portal by the taxpayer logging into the portal using valid credentials. After the upload is successful, the summary of the invoices uploaded is displayed.
Benefits of sales summary in GSTR-1
There are many benefits to the sales summary, or GSTR-1. They are:
Accurate record of transactions
The return provides a correct record of all the sales transactions, including the GST collected and paid into the government account.
Accurate computation of taxes
It promotes transparency in business operations and enables the accurate computation of taxes.
Accurate computation of input tax credit
Providing correct sales details in GSTR-1 helps the recipients claim the correct input tax credit and ensures credit flow to the appropriate recipient.
Compliance under GST laws
Filing GSTR-1 is a mandatory requirement under GST laws, and non-compliance can lead to penalties and legal consequences.
Avoidance of penalties and legal consequences
Timely and accurate filing of GSTR-1 helps taxpayers avoid penalties, interest, and other legal consequences.
Filing an accurate sales return in GSTR-1 helps in claiming eligible refunds. Certain businesses are eligible for GST refunds because of export sales or accumulated input tax credits. For such businesses, GSTR-1 returns are essential.
A sales summary is important in GST as it provides an accurate record of the sales transactions of businesses, helps recipients claim accurate input tax credit, maintains transparency, and ensures compliance under the law. It helps the tax authorities monitor the sales transactions and applicable taxes. It helps the authorities plan methods to curb tax evasion and check ineligible claims of input tax credit. Timely and accurate filing of GSTR-1 is crucial for an overall efficient and effective tax management system.
Frequently asked questions
When there are no sales to report, is filing GSTR-1 required?
Answer: Yes, the taxpayer must file a ‘NIL’ GSTR-1 when there are no sales in the relevant tax period.
Is it mandatory to file GSTR-1?
Answer: Yes, all taxpayers registered under GST must file GSTR-1. It is a mandatory requirement.
When can a taxpayer opt for quarterly filing of GSTR-1?
Answer: The taxpayer can opt to file GSTR-1 quarterly when his turnover during the preceding financial year is less than Rs 5 crore. Also, if the business is registered during the current financial year, expect a turnover of up to Rs 5 crore.
Can the taxpayer change the invoice details after uploading them to GSTR-1?
Answer: Yes, taxpayers can modify, add, or delete invoices before submitting the GSTR-1 for the tax period.