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Since the introduction of GST in India, the Indian financial sector has been leveraged to a more efficient and clear tax structure. It has brought in a lot of ease in business operations.
Before GST, startups in India that had a turnover of more than Rs 5 lakhs, had to pay a huge amount of tax in the form of VAT. But with GST, this number was increased to Rs 20 lakhs.
This has really helped small businesses and Indian startups to remain out of the tax bracket as GST has enabled them to focus on their core competencies and conduct their businesses seamlessly. It has also helped them save money from the capital funds. Moreover, startups can now rely on simple tax calculations and get everything in one form. The entire process has been made online, right from filing registration forms to GST returns. So filing GST returns in India is a lot easier now than it was years ago.
What is a GST Return?
The Goods and Services Tax (GST) Return is a document which has to be filed by all registered taxpayers under GST. These returns include purchase, sales, input tax credit (tax paid on purchases) and output GST (tax collected on sales).
Who Should Register?
Ideally, if you have a startup whose turnover exceeds Rs 40 lakh in a year, you should register your business under GST. But, even if it does not exceed the required threshold, you can still register voluntarily. Once you are registered, you will have to file the GST returns as prescribed under the law.
Types of GST Returns for Startups in India :
Before we get into the details of how to file GST returns for your startup, let us first understand the types of GST returns which are applicable for different kinds of startups. According to an Indian online startup portal, these are the types of GST returns for startups in India :
This return is to be filed in order to furnish the details of sales including B2B and B2C. The due date of this return is the 10th of every month and in case of a quarterly return, the end of next month of every quarter.
This is to rectify or resolve the mismatch in sales figures with your customers to whom you raise the tax invoice.
This is a summary return having details of net tax liability based on the output and input tax. Due date of this return is the 20th of every month.
It is for a business which opts for the composition scheme and needs to pay to subsidize GST rates from 1% to 5%. This is a quarterly return.
An e-commerce operator who needs to collect TCS (Tax Collected at Source) under GST requires to file this return till the 10th of every month.
It is the annual GST return, which has to be filed by all registered persons till 31st March of every financial year.
Process Of Filing GST Returns :
The entire process of GST registration and filing returns is automated and is done online. Here are the steps for how to file GST returns for your startup :
First and foremost, any Indian startup must register itself under GST law and obtain a registration number. This is a 15 digit number which is derived by means of registering your startup through an online procedure. The 15 digit number includes the state code of the state where your startup is located and your PAN. This step is compulsory without which you cannot go ahead with the process.
Visit the official GST website and go to the ‘services’ section. Under this, go to the ‘returns dashboard’ and start to fill out the form with relevant details. Make sure you enter the financial year for which returns are filed and specify the financial period correctly.
Choose Type Of Return
Select the type of GST return that you want to file, among the ones mentioned in the list.
Prepare and Submit Return
Finally, you need to prepare the return form and click on the ‘submit’ button.
How to check GST Return Status?
Just like any other admin work, it is important to check your GST return status. But how do you do this? Once you have successfully made the payment, you will be redirected to an acknowledgement page where the person who filed the GST return will get the Application Reference Number (ARN). Using this number, you can track your GST return status on the official GST website.
It is important to keep in mind that while the GST Returns process is quite easy for startups, taking an expert’s help is highly recommended. An expert would be able to guide you about the right kind of GST return filing for your startup and the variations that are applicable to e-commerce and online set-ups.