On completion of this lesson, you
will be able to understand:
·Main
features of GST Payment
·Timing of
Payment of GST
·Sequence of
Payment of Tax
·Interest on
Delayed Payment
·Challan for
Payment
Please go through the
Second Video of Chapter 7.
Time of GST Payment
The time is generally the
earliest of one of the three events, namely
oReceiving payment,
oIssuance of invoice or
oCompletion of supply.
In GST Law, there are
separate sections for Time of Supply for Goods and Services. Different
situations are envisaged and different tax points have been explained in the
GST Law.
Main Features of GST payment process
The payment processes under
proposed GST regime will have the following features:
• Electronically generated
challan from GSTN Common Portal in all modes of payment and no use of manually
prepared challan;
• Facilitation for the
taxpayer by providing hassle free, anytime, anywhere mode of payment of tax;
• Convenience of making
payment online;
• Logical tax collection
data in electronic format;
• Faster remittance of tax
revenue to the Government Account;
• Paperless transactions;
• Speedy Accounting and
reporting;
• Electronic reconciliation
of all receipts;
• Simplified procedure for
banks;
• Warehousing of Digital
Challan.
Timing of Payment of GST
Payment of taxes by the
normal taxpayer is to be done on monthly basis by the 20th of the succeeding
month. Payment of taxes for the month of April shall be paid by the 20th
of May.
·Cash payments will be first deposited in the Cash
Ledger.
·Taxpayer shall debit the ledger while making
payment in the monthly returns and shall reflect the relevant debit entry
number in his return.
·As mentioned earlier, payment can also be debited
from the Credit Ledger.
·Timing of payment will be from 0000 Hrs to 2000 Hrs.
Composition tax payers will
need to pay tax on quarterly basis.
Extension / Monthly Installments
Extension or Monthly
Installments are not allowed in in case of self-assessed liability. In other
cases, competent authority has been empowered to extend the time period or
allow payment in installments.
Date of Deposit of Tax
There may be a confusion
that which date to be considered as date of deposit of the tax dues either it
is Date of presentation of cheque or Date of
payment or Date of credit of amount in the account of government account?
It is to be noted that the date of credit of tax paid to the
Government account will be treated as Date of Deposit of Tax.
Sequence of Payment of Tax
Where that taxpayer has liabilities
for previous months or whatever case may be there is an order of payment. It
applies where the taxpayer has tax liability beyond the current return period.
In such a situation, the
order of payment to be followed is:
·First self-assessed tax and interest for the
previous period;
·Thereafter self-assessed tax and interest for the
current period;
·And thereafter any other amounts payable including
any confirmed demands under section.
This sequence has to be
mandatorily followed.
Interest on Delayed Payment of Tax
If any person fails to pay
tax or part thereof to the Government with the prescribed period, he should pay
interest @ 18% p.a. for the period for which it remains unpaid.
If a person makes an undue
or excess claim of input tax credit or undue or excess reduction in output tax
liability, he should pay interest at 24% p.a.
Challan
Challan is used for payment
of Taxes or any other amount.
Taxable Person after
logging in to the GST Common Portal can enter details required for making
payment. Payment particulars have to be fed in by the tax payer or his
authorized person. He can save the Challan midway for future updations.
Finalization of Challan
A Taxpayer can partially
fill in the challan form and temporarily “save” the challan for completion at a
later stage. A saved challan can be “edited” before finalization. However once
the challan is finalized and CPIN generated, no further changes can be made to
it by the taxpayer.
After the
tax payer has finalized the challan, he will generate the challan for use of
payment of taxes. The remitter will have option of printing the challan for his
record.
Validity period of Challan
A challan will be valid for
fifteen days after its generation and thereafter it will be purged from the
System. However, the taxpayer can generate another challan at his convenience.
CPIN
CPIN stands for Common
Portal Identification Number (CPIN) given at the time of generation of challan.
It is a 14 digit unique number to identify the challan. It will be generated
after finalization of Challan only. The Validity Period of CPIN is 15 days.
CIN
CIN stands for Challan
Identification Number.
It is a 17 digit number
that is 14-digit CPIN plus 3-digit Bank Code.
CIN is generated by the
authorized banks/ Reserve Bank of India (RBI) when payment is actually received
by such authorized banks or RBI and credited in the relevant government account
held with them. It is an indication that the payment has been realized and
credited to the appropriate government account.
CIN is communicated by the
authorized bank to taxpayer as well as to GSTN.No manual intervention will be
involved in the process by any one including bank cashier or teller or the
taxpayer.
Time of GST Payment
SECTION : GST Payment of Tax
DESCRIPTION
Lesson Objectives
On completion of this lesson, you will be able to understand:
· Main features of GST Payment
· Timing of Payment of GST
· Sequence of Payment of Tax
· Interest on Delayed Payment
· Challan for Payment
Please go through the Second Video of Chapter 7.
Time of GST Payment
The time is generally the earliest of one of the three events, namely
o Receiving payment,
o Issuance of invoice or
o Completion of supply.
In GST Law, there are separate sections for Time of Supply for Goods and Services. Different situations are envisaged and different tax points have been explained in the GST Law.
Main Features of GST payment process
The payment processes under proposed GST regime will have the following features:
• Electronically generated challan from GSTN Common Portal in all modes of payment and no use of manually prepared challan;
• Facilitation for the taxpayer by providing hassle free, anytime, anywhere mode of payment of tax;
• Convenience of making payment online;
• Logical tax collection data in electronic format;
• Faster remittance of tax revenue to the Government Account;
• Paperless transactions;
• Speedy Accounting and reporting;
• Electronic reconciliation of all receipts;
• Simplified procedure for banks;
• Warehousing of Digital Challan.
Timing of Payment of GST
Payment of taxes by the normal taxpayer is to be done on monthly basis by the 20th of the succeeding month. Payment of taxes for the month of April shall be paid by the 20th of May.
· Cash payments will be first deposited in the Cash Ledger.
· Taxpayer shall debit the ledger while making payment in the monthly returns and shall reflect the relevant debit entry number in his return.
· As mentioned earlier, payment can also be debited from the Credit Ledger.
· Timing of payment will be from 0000 Hrs to 2000 Hrs.
Composition tax payers will need to pay tax on quarterly basis.
Extension / Monthly Installments
Extension or Monthly Installments are not allowed in in case of self-assessed liability. In other cases, competent authority has been empowered to extend the time period or allow payment in installments.
Date of Deposit of Tax
There may be a confusion that which date to be considered as date of deposit of the tax dues either it is Date of presentation of cheque or Date of payment or Date of credit of amount in the account of government account?
It is to be noted that the date of credit of tax paid to the Government account will be treated as Date of Deposit of Tax.
Sequence of Payment of Tax
Where that taxpayer has liabilities for previous months or whatever case may be there is an order of payment. It applies where the taxpayer has tax liability beyond the current return period.
In such a situation, the order of payment to be followed is:
· First self-assessed tax and interest for the previous period;
· Thereafter self-assessed tax and interest for the current period;
· And thereafter any other amounts payable including any confirmed demands under section.
This sequence has to be mandatorily followed.
Interest on Delayed Payment of Tax
If any person fails to pay tax or part thereof to the Government with the prescribed period, he should pay interest @ 18% p.a. for the period for which it remains unpaid.
If a person makes an undue or excess claim of input tax credit or undue or excess reduction in output tax liability, he should pay interest at 24% p.a.
Challan
Challan is used for payment of Taxes or any other amount.
Taxable Person after logging in to the GST Common Portal can enter details required for making payment. Payment particulars have to be fed in by the tax payer or his authorized person. He can save the Challan midway for future updations.
Finalization of Challan
A Taxpayer can partially fill in the challan form and temporarily “save” the challan for completion at a later stage. A saved challan can be “edited” before finalization. However once the challan is finalized and CPIN generated, no further changes can be made to it by the taxpayer.
After the tax payer has finalized the challan, he will generate the challan for use of payment of taxes. The remitter will have option of printing the challan for his record.
Validity period of Challan
A challan will be valid for fifteen days after its generation and thereafter it will be purged from the System. However, the taxpayer can generate another challan at his convenience.
CPIN
CPIN stands for Common Portal Identification Number (CPIN) given at the time of generation of challan. It is a 14 digit unique number to identify the challan. It will be generated after finalization of Challan only. The Validity Period of CPIN is 15 days.
CIN
CIN stands for Challan Identification Number.
It is a 17 digit number that is 14-digit CPIN plus 3-digit Bank Code.
CIN is generated by the authorized banks/ Reserve Bank of India (RBI) when payment is actually received by such authorized banks or RBI and credited in the relevant government account held with them. It is an indication that the payment has been realized and credited to the appropriate government account.
CIN is communicated by the authorized bank to taxpayer as well as to GSTN.No manual intervention will be involved in the process by any one including bank cashier or teller or the taxpayer.
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