How to Make Payment

SECTION : GST Payment of Tax

  • Lesson Objectives

    On completion of this lesson, you will be able to understand:

    ·      Section 49 - Payment of Tax, Interest, Penalty and other amounts

    ·       Cash / Credit Card Payment

    ·       Tax Deducted at Source and TCS

    ·         Refund


    Please go through the Third Video of Chapter 7.

    Time of GST Payment


    Payment Methods

    The Payment of GST can be done in two methods.

    1        Input Tax Credit.

    2        Cash Payment.


    1       Input Tax Credit

    GST can be paid through debit of Credit Ledger of the taxpayer maintained on the Common Portal.

    ·        Tax payers shall be allowed to take credit of taxes paid on inputs (input tax credit) and utilize the same for payment of output tax. Inputs include goods and services used in the business.

    ·        ONLY Tax can be paid. Interest, Penalty and Fees cannot be paid by debit in the credit ledger.

    ·        No input tax credit on account of CGST shall be utilized towards payment of SGST and vice versa.


    ·        The credit of IGST would be permitted to be utilized for payment of IGST, CGST and SGST in that order.



    The order of utilizing the credit available in the electronic credit ledger can be better understood from the below table.


    Nature of Tax

    First Utilization

    Further Utilization

    Cannot be

    Adjusted against



















    TDS stands for Tax Deducted at Source (TDS).

    This provision is meant for Government and Government undertakings and other notified entities making contractual payments in excess of Rs. 10 Lakhs to suppliers.


    While making such payment, the concerned Government/authority shall deduct 1% or at such notified rate of the total payable amount and remit it into the appropriate GST account.


    2       Cash Payment

    GST also can be paid in cash by debit in the Cash Ledger of the taxpayer maintained on the Common Portal.


    Money can be deposited in the Cash Ledger by different modes, namely,

    ·        E-Payment (Internet Banking, Credit Card, Debit Card);

    ·        Real Time Gross Settlement (RTGS)/

    ·        National Electronic Fund Transfer (NEFT);

    ·        Over the Counter Payment in branches of Banks Authorized to accept deposit of GST.


    Credit Card Payment

    The taxpayer would be required to pre-register his credit card, from which the tax payment is intended, with the Common Portal maintained on GSTN. GSTN may also attempt to put in a system with banks in getting the credit card verified by taking a confirmation from the credit card service provider.


    The payments using credit cards can therefore be allowed without any monetary limit to facilitate ease of doing business.


    Utilization of TDS

    Any amount shown as TDS will be reflected in the electronic cash ledger of the concerned supplier. He can utilize this amount towards discharging his liability towards tax, interest fees and any other amount.


    Important Points

    The following points should be noted regarding the TDS in GST Law.

    ·        Such Deductors needs to get compulsorily registered under the GST Law.

    ·        They need to remit such TDS collected by the 10th day of the month succeeding the month in which TDS was collected.

    ·        They should report the same in GSTR 7.

    ·        They need to issue certificate of such TDS to the deductee within 5 days of deducting TDS.On any failure fees of Rs. 100 per day subject to maximum of Rs. 5000/- will be payable by such Deductor.


    Tax Collected at Source (TCS)

    This provision is applicable only for E-Commerce Operator. Every E-Commerce Operator needs to withhold a percentage (to be notified later on the recommendation of the GST Council) of the amount which is due from him to the supplier at the time of making actual payment to the supplier.


    Such withheld amount is to be deposited by such E-Commerce Operator to the appropriate GST account by the 10th of the next month. The amount deposited as TCS will be reflected in the electronic cash ledger of the supplier.



    The balance in the electronic cash ledger or electronic credit ledger after payment of tax, interest, penalty, fee or any other amount payable may be refunded in accordance with the provisions of Sec. 54.



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