GST Payment is mainly divided into the following categories –

  • CGST – Paid when making supply within the state (paid to center).
  • SGST – Paid when making supply within the state (paid to state).
  • IGST – Paid on interstate supply (paid to center)

Apart from the above payments a dealer has to make these payments –

1. How to calculate the GST payment?

Reduce the Input Tax Credit  from Outward Tax Liability to calculate the total GST payable. Deduct TDS/TCS from the total GST to determine the net payable figure. Add interest & late fees, if any, for the final amount. Both Interest and late fees are paid in cash.

One cannot claim ITC on interest and late fees.

The calculation differs depending on the type of dealers –

  1. Regular Dealer – A regular dealer is liable to pay GST on the outward supplies made. He can also claim Input Tax Credit (ITC) on his purchases. The GST payable by a regular dealer is the difference between the outward tax liability and the ITC.
  2. Composition Dealer – The GST payment for a composition dealer is comparatively simpler. A dealer who has opted for Composition Scheme has to pay a fixed percentage of GST on the total outward supplies made. This is because the input tax credit is ineligible. GST payable depends on the type of business of a composition dealer.

GST Accounting, GST Payment Rules

2. Who should make the GST payment?

The following dealers should make the GST payment –

Payment under GST, GST Payment

3. When should GST payment be made?

GST payment is made when the GSTR 3 is file. Timing of payment is from 12:00 am to 8:00 pm. The taxpayer has to deposit the cash payments in the Cash Ledger. The taxpayer then debits the ledger while making payment in the monthly returns. He also has to include the relevant entry number in his return.

GST Payment, Payment under GST

What are the payment Options?

GST portal has multiple options through which you can make tax payments: 

GST Payment, GST Payment options

Sequence of payment of tax where the taxpayer has liabilities for previous months

In such a situation, self-assessed tax and interest for the previous period is paid first. After that, the taxpayer will pay the tax and interest for the current period. Then, any other amounts payable including any confirmed demands under section 51 are paid. It is compulsory to follow this sequence.

What happens if the taxable person files the return but does not pay GST?

In such cases, the return is considered invalid. A return will not be considered valid unless the due tax is paid. Only a valid return is used for allowing input tax credit (ITC) to the recipient. In other words, the recipient cannot claim ITC unless:

  • the supplier pays the entire self-assessed tax
  • supplier files his return
  • the recipient files his return

As per section 28, a taxable person cannot use credits unless he files a valid return and pays the self-assessed tax.

GST Consulting, GST Payment Options

Refund under GST

Under GST, one can claim refund under following cases:

  • Export of goods and services
  • In case of unused input tax credit
  • Excess payment made by mistake
  • Refund of tax payments made by UN bodies, embassies, para-military force canteens, etc.
  • Credit accumulation due to output being tax exempt or nil-rated.

If you’ve paid an excess amount for GST, or want to claim a refund, you have to fill out a form from the GST portal. After verfication of the claim, you will get a refund of the excess amount. The processing of the refund can take anywhere between two weeks to sixty days.

Penalty

Penalties under GST are classified under two categories:

  1. If a taxpayer has not paid GST or makes short payments–  a penalty of 10% of the tax amount or a minimum of Rs. 10,000.
  2. If a taxpayer is found of committing fraud or is evading taxation– a penalty amount of tax evaded/short deducted etc., i.e., 100% penalty, or a minimum of Rs. 10,000.