GST payments

1. What are payments to be made under GST?

Under GST the tax to be paid is mainly divided into 3 –

• IGST – To be paid when interstate supply is made (paid to center)
• CGST – To be paid when making supply within the state (paid to center)
• SGST – To be paid when making supply within the state (paid to state)

Apart from the above payments a dealer is required to make these payments –

• Tax Deducted at Source (TDS) – TDS is a mechanism by which tax is deducted by the dealer before making the payment to the supplier

Usually, the Input Tax Credit should be reduced from Outward Tax Liability to calculate the total GST payment to be made.

TDS/TCS will be reduced from the total GST to arrive at the net payable figure. Interest & late fees (if any) will be added to arrive at the final amount.

Also, ITC cannot be claimed on interest and late fees. Both Interest and late fees are required to be paid in cash.

The way the calculation is to be done is different for different types of dealers –

Regular Dealer

A regular dealer is liable to pay GST on the outward supplies made and can also claim Input Tax Credit (ITC) on the purchases made by him.

The GST payable by a regular dealer is the difference between the outward tax liability and the ITC.

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.

GST is to be paid based on the type of business of a composition dealer.

Who should make the payment?

These dealers are required to make GST payment –

1. A Registered dealer is required to make GST payment if GST liability exists.

2. Registered dealer required to pay tax under Reverse Charge Mechanism(RCM).

3. E-commerce operator is required to collect and pay TCS

4. Dealers required deducting TDS

GST payment can be made in 2 ways –

• Payment through Credit Ledger –

The credit of ITC can be taken by dealers for GST payment. The credit can be taken only for payment of Tax. Interest, penalty and late fees cannot be paid by utilizing ITC.

• Payment through Cash Ledger –

GST payment can be made online or offline. The challan has to be generated on GST Portal for both online and offline GST payment.

Where tax liability is more than Rs 10,000, it is mandatory to pay taxes Online.

If GST is short paid, unpaid or paid late interest at a rate of 18% is required to be paid by the dealer.Also, a penalty to be paid. The penalty is higher of Rs. 10,000 or 10% of the tax short paid or unpaid.