What is GSTR-5?

GSTR-5 is a mandatory return form filed by non-resident taxable persons (NRTPs) under the Goods and Services Tax (GST) regime in India. The form requires taxpayers to submit data about their outward and inward supplies alongside their tax obligations and input tax credits, which must be filed during the specified tax period. Non-resident taxpayers need to submit GSTR-5 as their exclusive return for each month in which they operate their business within India.

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    GST Returns

    Why is GSTR-5 Important?

    GSTR-5 functions to protect tax transparency while enforcing compliance among entities that do not reside in India. Non-residents do not have permanent business establishments in India, so it is vital to monitor their business transactions effectively for tax reporting purposes.

    Filing GSTR-5 enables the GST authorities to monitor foreign trade operations and verify tax payment fulfillment to facilitate timely tax liability management of non-resident taxpayers. Failure to comply with GST requirements leads to penalties and even cancellation of registration.

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    Who Should File GSTR-5?

    Non-resident individuals and businesses that supply goods or services in India on a short-term basis must file GSTR-5. The GSTR-5 filing requirement extends to participants at trade exhibitions, foreign service providers, or overseas sellers executing limited business activities in Indian territory.

    Foreign entities conducting business in India need to register as non-resident taxable persons under GST while following a monthly GSTR-5 filing obligation for their period of active operations.

    Details to be Provided in GSTR-5

    The GSTR-5 return requires comprehensive data entry across several categories. Here’s what needs to be reported:​

    • Invoice-wise details of all outward supplies made during the tax period.
    • Information on goods and services imported into India, along with the amount of IGST paid.
    • Details of inward supplies subject to reverse charge.
    • Any credit or debit notes issued during the month.
    • Summary of ITC available, utilized, and carried forward.
    • Tax payable under CGST, SGST, IGST, and cess.
    • Interest and late fees, if any.
    • Refund claims, if eligible.

    Accuracy in each of these fields is essential to avoid mismatches, notices, or penalties.

    GSTR-5 Due Date and Late Fee

    GSTR-5 must be filed by the 13th of the month following the tax period. For example, returns for April must be submitted by May 13. If a non-resident taxable person fails to file GSTR-5 on time, the late fee is calculated based on the number of days the return is delayed, as per the following formula:

    • Filing Date – Due Date = Number of Days Delayed
    • Number of Days Delayed × ₹50 per day (₹25 CGST + ₹25 SGST) = Total Late Fee Payable

    For example, if GSTR-5 is due on May 13 and filed on May 20, the delay is 7 days. The total late fee would be: 7 days × ₹50 = ₹350

    Each GSTR-5 return incurs a maximum late fee amount of ₹5,000. After applying the late fee, GSTR-5 taxpayers must pay interest at 18% per annum on unpaid taxes between the due date and their actual payment date.

    When taxpayers delay their submissions, they face higher financial consequences and potentially lose their ability to request refunds while seeking extended GST registration. Businesses should use reliable GST software such as BUSY to help prevent errors and minimize compliance problems.

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    How to File GSTR-5 Online

    Filing GSTR-5 online is a simple process through the GST portal:​

    1. Log in to the GST Portal using the temporary GSTIN.
    2. Navigate to ‘Returns Dashboard’ and select the appropriate financial year and month.
    3. Click on ‘Prepare Online’ under GSTR-5.
    4. Enter details of outward supplies, inward supplies, import of goods, and ITC.
    5. Review auto-populated fields and make necessary corrections.
    6. Compute tax liability and make payment if applicable.
    7. Preview and submit the return using DSC/EVC.​

    Make sure all invoices and import documents are reconciled and uploaded correctly before final submission.​

    Difference Between GSTR-5 and GSTR-5A

    GSTR-5 and GSTR-5A serve different categories of taxpayers under GST. The differences are as follows:

    Criteria GSTR-5 GSTR-5A
    Applicability Non-resident taxable persons (NRTPs) supplying goods or services in India OIDAR service providers based outside India
    Type of Service Physical goods or taxable services Digital services (e.g., online streaming, cloud storage)
    GST Registration Requires GST registration as NRTP Does not require physical presence or full GST registration
    Filing Frequency Monthly, for each active business month Monthly, irrespective of activity volume
    Tax Payment Tax paid on both inward and outward taxable supplies Tax paid only on services provided to non-GST registered individuals

    A foreign company operating a booth at an Indian trade exhibition can directly sell products to attendees throughout the event duration. The business must operate under GSTR-5 Non-Resident registration since it delivers goods physically in India for a particular time.

    On the other hand, a streaming service like Netflix, headquartered outside India, provides digital content to Indian users who aren’t registered under GST. This provider is required to file GSTR-5A, since the services fall under OIDAR and do not involve a physical presence in India.

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    Common Errors to Avoid While Filing GSTR-5

    Filing Form GSTR-5 requires precision and attention to detail. Even minor errors can lead to delays, penalties, or compliance notices. Below are common mistakes that non-resident taxable persons should avoid:

    • Incorrect GSTIN Entry: Submitting returns with an invalid, incorrect, or expired GSTIN can result in automatic rejection of the filing. Always verify your GSTIN before submission.
    • Mismatch in Invoice and Supply Data: Discrepancies between invoice details and reported taxable value or tax amounts may raise red flags and lead to scrutiny, demand notices, or denial of credit to recipients.
    • Unreported Imports: Failing to disclose import transactions—especially those liable for IGST—can affect input tax credit eligibility and may be treated as under-reporting of liability.
    • Inaccurate ITC Reporting: Claiming ineligible or excess input tax credit not only results in a reversal but can also attract penalties and interest. Cross-check ITC entries with your purchase records and GSTR-2B, if applicable.
    • Delayed Filing: Submitting the return after the due date incurs late fees and interest, even in cases of nil transactions. Repeated delays may also impact refund eligibility or the extension of GST registration.

    A compliant accounting solution like BUSY can help automate data validation, reduce manual entry errors, and ensure timely filing.

    Conclusion

    Non-resident taxpayers must file GSTR-5 in a timely and accurate manner to maintain compliance status, prevent penalties, and ensure operational ease in India. Foreign businesses that operate in India temporarily must maintain updated knowledge about GST regulations and proper reporting while recording all documentation. Small mistakes in reporting, along with missed deadlines, create serious impacts on ongoing business operations and lead to detrimental financial consequences. Regular compliance not only fulfils legal requirements but also reinforces a company’s credibility with Indian partners and authorities.

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