Difference between Old Vs New GST Return System

• Introduction
• Old return filing system: Overview
• New return filing system: Overview
• Comparison: Old return Vs new return

Introduction

The Indian government aimed at introducing GST to streamline the taxation policies even further. Under the GST scheme, businesses followed the rule of ‘One Nation, One Tax’ which helped several taxpayers stay compliant seamlessly. However, several entrepreneurs found GST a bit complicated with numerous forms which are to be filed. Thus, to make the taxation system more simplified, the government announced the launch of GST 2.0 aka New Return Filing. The objective of the New Simplified GST Returns is to completely knock off the tax evasion pan India so that the transparency and equality can be attained under the indirect tax mechanism. Difference between Old Vs New GST Return System

Let’s look at how different GST 2.0 is from the old return filing mechanism and how it will benefit the taxpayers. Difference between Old Vs New GST Return System

Old return filing system: An overview

For reporting outward supplies and declaring tax liability GSTR-1 return should be filed. Input Tax Credit (ITC) on imports has to be claimed in GSTR-3B under eligible ITC.

If the taxpayer’s annual turnover is more than Rs 1.5 crore, he/she has to file monthly GSTR-1 or the taxpayer can file a quarterly GSTR-1. This return includes/developers on a bill of entry

Under the new return filing system

For reporting sales and declaring tax liability on the sales, GST ANX-1 should be filed. Imports are also to be reported in GST ANX-1 and ITC on imports will be auto-populated in GST RET-1.
Taxpayers are categorised into large taxpayer (whose annual turnover is more than Rs.5 crore) and the small taxpayer (whose annual turnover is up to Rs.5 crore), as per the GST 2.0. A large taxpayer has to file monthly GST ANX-1, whereas the small taxpayer can file his GST ANX-1 monthly or quarterly at his option.

This return includes

Comparison – old vs new GST return system

The form GST ANX-1 under the new return system is similar to GSTR-1 under the old return system, apart from a few changes. 

• Reporting of supplies under RCM

In the current filing system, invoice details can be reported while filing GSTR 1 form but can be viewed afterwards in GSTR-2A. In the new filing system, you can view and file simultaneously for instant action.

• HSN summary reporting

Under the old return system, the HSN code summary needs to be reported separately. But in the new return system, the supplier has to report the HSN codes at the invoice level (based on his turnover). In this way, the taxpayer will get the HSN data via his GST ANX-2 wherever the supplier was required to declare HSN. Difference between Old Vs New GST Return System

• Reporting of imports

Under the old return filing system, ITC on imports alone has to be reported in GSTR-3B. However, under the new return filing system, the taxpayer has to report imports of goods and services in GST ANX-1. Difference between Old Vs New GST Return System

• Tax payment

In the current system, while filing monthly return GSTR-3B, full tax liability must be paid for a tax period. In the new system, regardless of monthly or quarterly filing of GST returns, complete tax liability must be paid for a tax period in monthly PMT-08. Difference between Old Vs New GST Return System

• Reporting of documents issued

Under the new return system, there is no requirement for reporting of documents (along with serial numbers) like invoices, debit/ credit notes, receipt/ payment/ refund vouchers,

delivery challans which were issued during the tax period. Difference between Old Vs New GST Return System