GST Payment

A disquisition on GST payment process

As per the speculations, GST Act in India would be implemented from July 1st, 2017. No wonder that the commencement of new indirect taxation regime would pave way for elimination of all the complexities and complications related to current indirect taxation system. However, we must not remain oblivion to the fact that in order to ensure coercive enforcement, it becomes imperative to address the qualms of taxpayers related to standard procedure of GST payment.

We have complied all the crucial information with the aim of creating awareness among taxpayers regarding GST payment process.

Who is eligible to pay GST?

In general, suppliers of goods/services are liable to pay GST in the Goods and Services Tax regime. However, there exist some special cases (like imports of goods), and in such a scenario, the liability to pay GST may be cast on the person who is the recipient under reverse charge mechanism. Furthermore, in some notified cases related to intra-state supply of services, the e-commerce — through which such services are supplied — are liable to pay GST before the specified GST payment dates.

For any intra-state supply in the GST regime, taxes to be paid are the Central GST (which would go into the account of the Central Government) and the State/UT GST (which would go into the concerned State Government’s account). For any inter-state supply in the GST regime, tax to be paid is Integrated GST (which would have components of both CGST and SGST). Additionally, one would also need to pay interest, penalty, and fees wherever applicable as per the GST rules India.

What is electronic tax liability register?

It shall be maintained and managed (in FORM GST PMT-01) for each person or business entity liable to pay interest, tax, penalty, late fee or any other amount on the Common Portal, and all the amounts payable by him/her shall be debited to the electronic tax liability register.

The electronic tax liability register of a taxpayer shall be debited by:

  • A the amount payable towards late fee, tax, interest, or any other amount (payable as per the taxpayer’s return)
  • B the amount of interest, penalty, tax, or any other amount payable (as determined by a proper officer)
  • C tny amount of interest that may accrue (as per GST Act India) from time to time

What is electronic credit ledger?

It shall be maintained and managed (in FORM GST PMT-02) for each registered person or business entity eligible for input tax credit on the Common Portal, and every claim of input tax credit shall be credited to the electronic credit ledger.

What is electronic cash ledger?

It shall be maintained and managed (in FORM GST PMT-05) for each registered taxable person or business entity on the Common Portal for crediting the amount deposited and debiting the payment therefrom towards tax, interest, penalty, fee, and/or any other amount.

When should be the payment made by the Supplier?

Payment of taxes by a taxpayer is to be done on monthly basis, and it must be noted that it should be done by the 20th of the succeeding month. At the same time, there is no specified monthly GST payment dates for composition tax payers; they will need to pay tax on quarterly basis.

The table below shows various types of payment forms for GST-registered taxpayers.

S. No. Form No. Title of The Form
1. Form GST PMT-1 Electronic Tax Liability Register of Taxpayer
(Part–I: Return related liabilities)

Electronic Tax Liability Register of Taxpayer
(Part–II: Other than return related liabilities)
2. Form GST PMT-2 Electronic Credit Ledger
3. Form GST PMT-2A Order for re-credit of the amount to cash or credit ledger
4. Form GST PMT-3 Electronic Cash Ledger
5. Form GST PMT-4 Challan For Deposit of Goods and Services Tax
6. Form GST PMT-5 Payment Register of Temporary IDs/Un-registered Taxpayers
7. Form GST PMT-6 Application For Credit of Missing Payment (CIN not generated)

Main features of GST payment process

  • Electronically generated challan from GSTN Common Portal
  • The electronic credit ledger shall be maintained and managed for each registered person or business entity eligible for input tax credit on the Common Portal, and every claim of input tax credit shall be credited to the electronic credit ledger.
  • Faster remittance of tax revenue to the Government Account
  • Paperless transactions
  • Hassle-free mode of payment of tax
  • Simplified procedure for banks
  • Convenience of making online GST payment
  • Speedy Accounting and reporting
  • Electronic reconciliation of all receipts

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