BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.
All taxpayers who have registered under GST are required to file their GST returns as per GST Law. By filing these returns, taxpayers and the government get clarity on the amount of GST to be paid. To file these returns correctly and with minimal fuss, the taxpayer must have GST-compliant invoices for both sales and purchase transactions. GSTR 1 is a crucial form that must be completed in order to start the process of filing of these returns. This is because the information submitted in GSTR 1 serves as the foundation for auto-populating all other forms.
In this article, we will understand what is GSTR-1, including the sections under it, when it is due, who is liable to file it, and penalties for late filing. After reading this article, you should be a step closer to ensuring your business is GST-compliant.
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GSTR 1 is a crucial form that helps track the outward supply of goods and services. It is mandatory to file this return on a monthly basis, though eligible taxpayers who have opted for the QRMP Scheme need only file it once a quarter. All suppliers of goods and/or services must provide specific details about the supplies and the recipients, which are then used to auto-populate the returns for inward supplies.
Utmost care and attention to detail is required when filing GSTR-1, as it forms the bases for many other GST Forms. Any mistakes or negligence when filing this return will reflect in the other returns, and not just yours, but those of your recipients as well. For example, if you do not report a B2B supply transaction in your GSTR-1, then it will not reflect when auto-populating the GSTR-2A of the recipient of that supply. This will impact the recipient’s ability to claim Input Tax Credit on that purchase which you have supplied.
The GSTR-1 form includes thirteen sections within it. These sections are:
The turnover of a business determines its GSTR 1 due date. GSTR-1 returns must be filed either monthly or quarterly, depending on the business’s turnover. Businesses can file GSTR-1 and GSTR-3B quarterly if their annual revenue is up to Rs. 5 crore AND they have opted for the QRMP Scheme as mentioned above; otherwise, they must file monthly returns if their annual turnover exceeds Rs. 5 crore.
Each registered dealer must complete the GSTR 1 filing process. The same is required and unaffected by the transactions that occurred that month. If you are a registered dealer, you must complete the GSTR-1 filing process even if there are no sales or transactions (this is called filing Nil returns). However, the following people or companies are excluded from submitting GSTR 1:
You must have a 15-digit PAN-based GSTIN and be a GST-registered taxpayer.
You must maintain detailed invoices with distinct serial numbers for your transactions, including intrastate and interstate transactions, business-to-business (B2B), and retail (B2C) sales. This also covers stock transfers between your company’s locations in other states and transactions involving exempt and non-GST products.
To validate your return using an EVC (electronic verification code) or a digital signature certificate, you must either have an OTP from your registered phone (class 2 or higher). Using an Aadhar-based e-sign, you can also submit your GST returns.
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On the GSTN platform, filing GSTR 1 is simple. Simply follow the instructions listed below to submit your GSTR-1 using the GSTN portal:
You will be required to pay a late charge at the following rate if you cannot submit your GSTR-1 return by the deadline. A yearly interest rate of 18% will also be assessed on the amount of unpaid taxes:
How to Revise GSTR-1?
Once GSTR-1 is filed, it cannot be revised directly. However, if you made errors or missed entries in your original GSTR-1, you can correct them in the next month’s GSTR-1 filing. To do this, include the missing invoices or make adjustments for errors in the “Amendments” section of the subsequent GSTR-1. This allows you to update the details of previous tax periods. It’s important to review your data carefully before filing each month to minimize the need for amendments. Remember, GSTR-1 amendments can only be done for the current financial year.
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GSTR-1 for Different Businesses
GSTR-1 applies to all businesses registered under GST that supply goods or services. The form is used to report outward supplies (sales) and must be filed monthly or quarterly, depending on the business’s turnover. Businesses with a turnover up to ₹5 crore can opt for quarterly filing under the QRMP scheme, while others must file monthly. The information filed in GSTR-1 helps buyers claim input tax credit. Proper and timely filing ensures that business records stay updated and compliant with GST regulations.
Making Changes to Sales Data After Filing GSTR-1
If you realize there are errors in your sales data after filing GSTR-1, you can make corrections in the next GSTR-1 filing. Use the “Amendment” section to adjust any mistakes, such as wrong invoice details or amounts. You cannot delete or modify the original filed GSTR-1 but can amend it for the current financial year. It’s essential to file accurate amendments to avoid penalties or discrepancies in GST returns. Ensure you double-check the corrected details before submitting them in the following return to avoid further errors.
After reading this article you may have undesrtood GSTR 1 meaning and In essence, information about outgoing supplies made during the month must be recorded in the GSTR-1 format as either invoice-specific, rate-specific, or state-specific information.
Not filing GSTR-1 correctly and on time can harm the reputation of your business as well, as your Compliance Rating may suffer.
As input tax credit depends on the supplier’s compliance, it will also affect one’s customers. Potential B2B buyers may refrain from doing business with you if you don’t file your GSTR-1 correctly, due to the problems they will face when not being able to claim ITC.
BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.