When Filing your GST Returns, Avoid These Common Mistakes.

GST (Goods and Service Tax) registered businesses need to file monthly or quarterly GST returns and annual GST returns. A GST return is an official document where the registered GST taxpayer enters all the details of income, sales, expenses, and purchases of a particular period. The GST returns help in calculating the net tax liability of the taxpayers and promotes transparency in the taxation system.

Accuracy in filing GST returns is crucial. It helps to avoid penalties and further complications. In order to file the GST returns correctly, one should know the basics along with the common mistakes that one may make. This article will discuss how you can avoid mistakes in GST filing.

Common Mistakes When Filing in GST

GST returns have various ranges, and one has to file GST returns as per their range. It includes GST-1, GSTR-3B, GSTR-4 and 5, GSTR-5A, GSTR-6, 7, 8, 9, 10, 11, CMP-08, and ITC-04. So, it is also essential to understand which GST range has to be filed. Here are some of the common mistakes that taxpayers may make while filing GST returns:

1. Not Knowing What Type of GST to File – As aforementioned, GST returns have various categories. So, it is essential to figure out the category in which your GST liabilities fall and fill out the correct form. Some businesses have to file monthly GST returns, while others have to file on a quarterly basis. Also, everyone has to file annual GST returns as well. If you do not understand, you may take the help of a professional to avoid mistakes.
2. Not filing NIL Return Reporting NIL is as important as filing transactions. Sometimes, there may be nothing to fill in sales or purchases, but that does not mean that you leave the space empty. You need to mention NIL to avoid any penalty.
3. Not Reconciling GSTR 1 & GSTR 3B – Reconciliation of GSTR 1 and GSTR 3B is important and a must. It maintains the accuracy in the GST filing. Hence, make sure you do not forget this step.
4. Entering Incorrect Details – In any sort of government report, if you fail to provide correct details or mistakenly input the wrong information, it may cause problems. While filing GST returns, ensuring correct details is quintessential, or your form may be put on denial.
5. Delay in filing GST returns – You are given a sufficient time frame to file GST returns. So, you must adhere to the timelines and do the needful on time. Failing to do so may result in the cancellation of your registration and legal actions.
6. Export-sale details error The details of export sales also have to be mentioned in a GST return. It has to be mentioned in the zero-rated column. If you misplace the information in any other section or enter the wrong details, the whole conclusion of the GST returns may be altered and lead to the rejection of the GST return form.
7. ITC Claim errors – With the help of filing ITC (Input Tax Credit), the taxpayer can avail of a deduction in the tax liability. As per the GST returns rules, taxpayers can claim ITC. So, it is crucial to enter the correct details of the ITC Claim. Failing to do so may not help you get tax deductions.
8. Incorrect invoice entry in GSTR 1 – In order to maintain the reconciliation between GSTR-1 AND GSTR-3B, the invoice details mentioned in the GSTR-1 have to be correct and accurate. The data on outward supplies, the place of supply and the tax rate have to be mentioned. Make sure there is no error to avoid further complications.

Let’s Conclude

Adhering to GST norms is a must for any business in the country. Filing GST returns legally, correctly, and on time is a must. Incorrect information, misplacement of the details, or failing to file GST returns on time can all lead to legal actions, penalties, and even cancellation of the GST registration. You may hire professionals for this task if you do not have sufficient time to do so. Ensure there are no errors and enjoy a smooth functioning of the taxation system.