Standard Operating Procedure on TDS under GST
GST
Dated:- 29-9-2018
PDF DOWNLOAD
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Document 1GST
NATION
TAX
MARKET
STANDARD OPERATING PROCEDURE
TDS
家
under GST
A ready reckoner for DDOS / other Deductors in GST
Law Committee
GST Council
28th September 2018
Contents
1. Introduction..
2. Relevant provisions of TDS in GST and effective date
2.1 Provisions of Law ……
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2.2 Effective date
………
2.3 Brief Diagrammatic representation of the TDS provisions in GST……………………………. 6
2.4 Concept of Supply in GST……….
3. When tax deduction is required to be made in GST………
3.1 Conditions for & amount of deduction
4. When tax deduction is not required to be made in GST……..
5. Illustrations of various situations requiring deduction of tax…….
…
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6. Valuation of supply for deduction of TDS and applicable rates with
illustrations…….
6.1 Rate of dedu
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…..
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10.1 TDS return submission procedure……..
10.2 Time limit for filing the TDS Returns under GST …….
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11.
Benefit of TDS to deductee and TDS certificate………
12.
Late fee, interest and penalty..
13.
14.
Legal References…….
Frequently asked questions (FAQs)………
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1. Introduction:
The concept of Tax Deduction at Source (TDS) was there in the
erstwhile VAT Laws. GST Law also mandates Tax Deduction at Source
(TDS) vide Section 51 of the CGST/SGST Act 2017, Section 20 of the
IGST Act, 2017 and Section 21 of the UTGST Act, 2017. GST Council in
its 28th meeting held on 21.07.2018 recommended the introduction of
TDS from 01.10.2018.
Following would be the deductors of tax in GST under section 51 of the
CGST Act, 2017 read with notification No. 33/2017-Central Tax dated
15.09.2017:
(a) a department or establishment of the Central Government or
State Government; or
(b) local authority; or
(c) Governmental agencies; or
(d) an authority
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after referred to as 'the deductee') at a prescribed rate.
2.2 Effective date:
Notification No. 33/2017 – Central Tax dated 15.09.2017 was issued
by the CBIC to enable registration of tax deductors. However,
Government suspended the applicability of TDS till 30.09.2018.
Now, it has been decided that the TDS provision would be made
operative with effect from 01.10.2018. Notification No. 50/2018-
Central Tax dated 13.09.2018 has already been issued in this regard by
CBIC. Similar notifications have been issued by respective State
Governments.
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2.3 Brief Diagrammatic presentation of the TDS provisions in GST:
Deductor is required to
take registration
[Sec 24(vi)]
Registration to be done through the common
portal www.gst.gov.in by using PAN/TAN
Enters into
Contract for
of
purchase
taxable goods
/ services or
both with any
supplier
Total Value of taxable supply under
a contract (excluding GST) >Rs.2.5L
→ Deduct tax from payment
Total Value of taxable supply under a
contract (excludi
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legislature B, it is
an inter-State supply and TDS @ 2% under IGST Act is to be
deducted if the deductor is registered in State A.
f. When advance is paid to a supplier on or after 01.10.2018 to a
supplier for supply of taxable goods or services or both.
4. When tax deduction is not required to be made under
GST:
Tax deduction is not required in following situations:
a) Total value of taxable supply ≤ Rs. 2.5 Lakh under a contract.
b) Contract value > Rs. 2.5 Lakh for both taxable supply and
exempted supply, but the value of taxable supply under the said
contract ≤ Rs. 2.5 Lakh.
c) Receipt of services which are exempted. For example services
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exempted under notification No. 12/2017 – Central Tax (Rate)
dated 28.06.2017 as amended from time to time.
d) Receipt of goods which are exempted. For example goods
exempted under notification No. 2/2017 – Central Tax (Rate) dated
28.06.2017 as amended from time to time.
e) Goods on which GST is not leviable. For example petrol, dies
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nregistered supplier.
m) Where the payment relates to “Cess” component.
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5. Illustrations of various situations requiring deduction
of tax:
Situations / Contracts
Deduction
required
Remarks
YES/NO
Finance Department is making a
payment of Rs.3 Lakh to a supplier
of 'printing & stationery'.
Education Department is making
payment of Rs.5 Lakh to a supplier
of 'printed books and printed or
illustrated post cards' where
payment for books is Rs.2 Lakh and
Rs.3 Lakh is for other printed or
illustrated post cards.
Finance Department, is making
payment of Rs.1.5 Lakh to a supplier
of 'car rental service'.
Yes
Yes, deduction
is required in
respect of
payment of Rs.
3 Lakh only i.e.
for payment in
respect of
taxable supply.
See Remarks
Where the total contract
value of taxable supply is
more than Rs.2.5 Lakh
deduction is mandatory.
Books are exempted goods;
no deduction is required in
respect of supply of books.
However, payment involving
'printed or illustrated post
cards' is for supply of ta
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tor has made payment or credited the amount to the supplier's account.
Q44 What are the modes of signing FORM GSTR-7?
A. FORM GSTR-7 can be filed using DSC or EVC.
Q45 Can I preview the FORM GSTR-7 before filing?
A. Yes, the preview of FORM GSTR-7 can be seen by clicking on ‘Preview Draft GSTR-7' before
filing on the GST Portal.
Q46 What happens after FORM GSTR-7 is filed?
A. After FORM GSTR-7 is filed:
•
ARN is generated on successful filing of the return in FORM GSTR-7.
An SMS and an email are sent to the applicant on his registered mobile and email id.
Q47 Can I file the complete FORM GSTR-7 using Offline Utility?
A. No. Filing can take place only online on the GST Portal.
The details of Table 3 and Table 4 can be prepared offline but remaining activities like
payment and filing has to be completed on the portal only.
Once the json file is uploaded on the GST Portal, one may continue to proceed to file.
Liabilities will then be computed and after making payment, return c
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o GST Portal to download the FORM GSTR-7 Offline Utility?
A. No. One can download the FORM GSTR-7 Offline Utility under 'Download' section
without logging in to the GST Portal.
Q51
A.
Q52
Do I need to login to GST Portal to upload the generated JSON file using FORM
GSTR-7 Offline Utility?
Yes. You must login in to the GST Portal to upload the generated JSON file using FORM
GSTR-7 Offline Utility.
What are the basic system requirements/ configurations required to use FORM
GSTR-7 Offline Tool?
A. The offline functions work best on Windows 7 and above and MS EXCEL 2007 and above.
Q53 Is Offline utility mobile compatible?
A. As of now FORM GSTR-7 Offline utility cannot be used on mobile. It can only be used on
desktop/laptops.
Q54 How many TDS details of the suppliers can I enter in the offline utility?
A. One can enter maximum 10,000 rows of TDS details of the suppliers in the offline utility.
I am a tax deductor. I've made payment for four different products to one of my
Q55 suppliers. S
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e utility?
A. No, any negative value cannot be entered in the utility. However, decimal values can be
entered. All decimal values would be rounded off to two decimal places. But, total liability
will be rounded off to whole number.
Q58
I've uploaded GSTR-7 JSON File and it was processed without error. Do I need to
download the generated file?
A. No, it is not necessary to download the GSTR-7 JSON File processed without error. One can
download it only if he wants to update, add or delete the details added previously. One can
download the uploaded file for record if so required.
Q59
Interest, Penalty & Late Fee
Mr A, a DDO has submitted return for the month of November upon payment of
liability as shown in such return on 11.12.2018. Is he liable to pay interest?
A. Mr. A has to pay interest for one day as return is to be filed by 10 th December, 2018.
Q60
Mr X has deducted Rs 1 lakh of TDS in Nov'18. He deposits Rs 70,000/- on
10.12.2018 & the rest of Rs 30,000 on 30.01.2019. He submits
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aid sub-section, or where he fails to pay to
the Government under sub-section (2) of section 51 [section 122(v) refers]. He is liable
to penalty of Rs.1,00,000/-.
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TDS Certificate &Benefit of TDS to the deductee
As a DDO I have deducted tax while making payment to various Vendors. I have
Q61 deposited the amount in the appropriate Government A/c & also filed return
within stipulated time. Have I discharged all my liabilities relating to TDS?
A. No. A system generated TDS certificate in FORM GSTR-7A mentioning therein the value on
which tax is deducted, and amount of tax deducted and other related particulars shall be
available for download from the portal by deductee.
Q62 How can a supplier download the TDS certificate in FORM GSTR 7A?
A. TDS certificate can be downloaded by access the www.gst.gov.in URL and using the
following path: Login to the GST Portal with valid credentials. Navigate to Services > User
Services > View/Download Certificates option.
Q63 How many TDS Certificat
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