The implementation of the Goods and Services Tax (GST) system in India has resulted in positive changes to the country’s taxation system. The government has introduced the GST Composition Scheme to simplify tax compliance for small taxpayers. This scheme offers two types of GST registration: Regular GST registration and Composition Scheme registration. Under the Composition Scheme, dealers can file their GST return annually using Form GSTR 4. All the assesses covered under the composition scheme file the annual GST (Goods and Services Tax) returns via the Due date of the GSTR 4 form till 30th April for every financial year.
Taxpayers who have chosen the Composition Scheme must file the GSTR-4 return annually. Before the financial year 2018-19, this return was filed quarterly until it was replaced by CMP-08. The Composition Scheme enables taxpayers with an annual turnover of up to Rs. 1.5 crore to adopt a simplified tax structure and submit quarterly returns using the GSTR-4 form. To ensure tax compliance and avoid penalties, keeping track of the GSTR-4 due date is crucial.
What Is GSTR-4?
GSTR-4 is a quarterly return that must be filed by eligible taxpayers registered under the GST Composition Scheme. Including details of tax payable and paid, It summarizes the outward and inward supplies made during the quarter. Small taxpayers who have opted for this scheme can enjoy benefits such as reduced compliance requirements and lower tax rates, but they must meet the stipulated timeframe for filing their GSTR-4 returns.
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Who Is Eligible to File GSTR-4?
Taxpayers who have opted for the Composition Scheme under the Goods and Services Tax (GST) are eligible to file GSTR-4 which provides certain benefits, such as reduced compliance requirements and lower tax rates. The due date for filing Form GSTR-4 (Annual Return) is the 30th of the month following the financial year unless extended by the government. This also includes the special composition scheme notified for service providers, effective from the financial year 2019-20, as per the CGST (Rate) notification number 2/2019 dated March 7, 2020.
Composition Taxpayers can Now File GSTR-4 on GST Portal
The Central Board of Indirect Taxes and Customs (CBIC) has introduced an option for the composition taxpayers to file form GSTR 4 online on the GST portal. The GSTR 4 form is required to be filed by all the composition taxpayers, annually for each financial year, with effect from 1st April 2019.
Read Also: Latest Due Date of CMP-08 Return Filing
Who Can File NIL Under Form GSTR-4?
Assessees who meet any of the following conditions in each quarter of the financial year can file a NIL form under GSTR-4:
- No outward supply made
- No goods/services received
- No other liabilities to report
- All Form CMP-08 filed as Nil.
GSTR 4 due date for FY 2023-24
| Period | Extended Due Date |
|---|---|
| Annual Return FY 2023-24 | 30th April 2024 |
| Annual Return FY 2022-23 | 30th April 2023 |
| Annual Return 2021-22 | 30th April 2022 |
The last date to file the GSTR 4 annual return of the form is the 30th of the month in which it was previously filed last year.
Legal Consequences and Penalty of Not Filing GSTR-4 Before the Due Date?
Penalty
In accordance with the latest update, a late fee of Rs. 50 per day is imposed, up to a maximum of Rs. 2,000. If there is no tax liability, the maximum late charge is Rs. 500.
Previously, a late fee of Rs. 200 per day was charged for late filing of GSTR-4. The maximum late fee was capped at Rs. 5,000.
Consequences of Missing the GSTR 4 Due Date
There can be various adverse outcomes for taxpayers who fail to file their GSTR-4 returns within the designated deadline. These repercussions encompass –
- Late Fees: Taxpayers will be required to pay a late fee of Rs. 200 per day of delay (Rs. 100 for CGST and Rs. 100 for SGST), with a maximum of Rs. 5,000. Late fees for IGST will be charged separately.
- Interest Charges: Interest will be levied at a rate of 18% per annum on the outstanding tax liability.
- Legal Consequences: Continuous non-compliance may result in legal actions, including tax recovery and cancellation of GST registration.
Latest Update & Notification
Update for Composition Dealers in 32nd GST Council Meeting:
1. The limit of the composition dealers has been increased to Rs. 1.5 Crore. This is applicable for 1st April 2019.
2. The composition rate for the services sector has been fixed at 6 percent while the composition limit has been set at Rs 50 lakh.
3. The GSTR 4 return (Composition Dealers) will have to pay tax quarterly basis but the return will be filed only once a year.
These categories of taxpayers are not liable to file GSTR 4, Non-resident Taxable Persons, Taxpayers liable to collect TCS, Input Service Distributors, Taxpayers liable to deduct (TDS), Composition Dealers, Compounding taxable persons, Suppliers of OIDAR (Online Information and Database Access or Retrieval).
How Form GSTR 4 is Different from the Quarterly Returns
Form GSTR 4 is quite different from the returns which are required to file quarterly.
- The form can be filled by the composition taxpayers starting from 31st August 2019.
- For the period before that, the assesses were required to file GSTR 4 returns quarterly. Now the assessees are required to file form CMP 08, quarterly and form GSTR 4, annually.
Penalty & Late Fees
- The dept has fixed the late penalty of INR 200 per day in case of not filing GSTR 4 till the due date.
- No more than Rs. 5,000 can be charged as a late fee.
