Navigating GST Returns for Businesses Below the Turnover Threshold

When running a business in India, understanding how to file Goods and Services Tax (GST) returns is crucial, even if your annual turnover falls below the specified threshold. This guide breaks down the process, ensuring businesses can comply with GST regulations effectively.

Understanding Your GST Registration Requirement

Whether or not you need to register for GST hinges on your business's turnover. For majority of Indian states, the threshold limit for registration is ?20 lakhs (2 million), while special category states set the limit at ?10 lakhs (1 million). If your turnover is below this threshold, you may not be required to register for GST. However, if you choose to voluntarily register, you are still obligated to comply with GST regulations and file returns as per the guidelines.

Types of GST Returns

Knowing which GST returns to file is the next essential step:

GSTR-1: This return is for reporting sales made during the period, also known as outward supplies. It must be filed by all registered taxpayers. GSTR-3B: This is a summary return for tax payments. It is filed monthly or quarterly depending on your average monthly turnover. If you have an average monthly turnover of over ?10 lakhs (1 million) in special category states or ?20 lakhs (2 million) in other states, you must file GSTR-3B.

The Filing Process

Filing your GST returns involves several steps:

Login to the GST Portal: Access the GST Portal with your credentials. Navigate to the Returns Dashboard: This is where you'll choose the relevant return form. Select the Relevant Return: Choose between GSTR-1 for sales or GSTR-3B for tax payments and declarations. Fill in the Details: Provide necessary information, including sales and purchases, and any other relevant data. Review and Submit: Double-check your information before submitting the return. If taxes are due, ensure to pay them at this stage.

Due Dates and Payment of Taxes

Be aware of the due dates for filing GST returns. Generally, GSTR-3B is due on the 20th of the following month. The due dates for GSTR-1 vary based on your turnover. Regardless of the due date, always ensure timely submission to avoid penalties. If payment is due while filing GSTR-3B, make the payment accordingly.

Keeping Proper Records

Maintaining accurate records of all transactions and filed returns is crucial. This ensures compliance with future audits and helps in quick reference. Regular record-keeping can also aid in managing inventory and financials more efficiently.

Seek Professional Help

If you are uncertain about the process, consulting a tax professional can be beneficial. Tax experts can provide guidance, ensuring you comply with all GST regulations and help you navigate complexities.

Conclusion

Regardless of your business’s turnover, understanding and adhering to GST norms is crucial for compliance. By following this guide, you can effectively manage your GST returns, even if your turnover is below the set threshold.