Goods and Services Tax (GST) is a tax system in India that has changed how businesses handle taxes. All businesses registered under GST must file their returns regularly. A GST return is a document that businesses submit to the government. It shows details of their sales, purchases, and tax payments. But one question that many businesses have is: What are the charges for filing GST returns? We will explain GST return filing charges in simple words. We will talk about the costs involved, penalties for late filings, who needs to pay, and other important details. This will help you understand what expenses you need to plan for when filing your GST returns.
Who Needs to File GST Returns?
All businesses that are registered under GST must file GST returns. This applies to large businesses, small businesses, online sellers, and even service providers. Depending on the size and type of business, you may need to file returns monthly, quarterly, or annually. The more frequently you file returns, the more you may have to spend on filing charges.
Why Do Businesses Pay GST Return Filing Charges?
Filing GST returns is a mandatory requirement for all businesses registered under GST. While the government does not directly charge a fee for using the GST portal, businesses often spend money on other things like hiring a professional to file the returns, buying GST software, or paying penalties for late filing. Understanding these costs is important for managing your business finances effectively.
GST Return Filing Charges
| Type of Charge | Details | Estimated Cost (INR) |
|---|---|---|
| Professional Fees (Accountant/CA) | Charges for hiring a professional to file GST returns, varies by the complexity and size of the business. | ₹500 to ₹10,000+ per return |
| GST Software Subscription | Cost of using GST filing software for self-filing, with features like auto-calculations and error detection. | ₹2,000 to ₹10,000 per year |
| Penalty for Late Filing (NIL Return) | Fee for filing NIL returns after the deadline. | ₹20 per day (Max ₹5,000) |
| Penalty for Late Filing (Regular Return) | Fee for filing returns late, with tax payable. | ₹50 per day (Max ₹5,000) |
| Interest on Late Payment of GST | Charged at 18% per annum on the outstanding tax amount if GST is paid late. | 18% per annum on unpaid tax |
| Reconciliation Costs | Professional fees or software tools for matching purchase and sales data before filing returns. | ₹1,000 to ₹5,000 (varies by business) |
| Auditing Fees | For businesses that need to audit their GST returns, especially large or complex businesses. | ₹10,000 to ₹50,000 per year |
| Revised Return Filing | Additional charges for filing a revised return due to errors in the original submission. | Varies (can be as much as original fee) |
| Annual Return Filing (GSTR-9) | Professional fees for filing the yearly summary of transactions. | ₹2,000 to ₹15,000+ |
| Penalty for Non-Filing of Annual Return | Charged for failure to submit GSTR-9 by the due date. | ₹100 per day (Max ₹20,000) |
| Interest for Input Tax Credit Mismatch | Interest charges if there is a mismatch in input tax credit claims between seller and buyer. | 24% per annum on disputed amount |
| Late Payment on TDS under GST | Interest for delayed payment of tax deducted at source under GST. | 18% per annum |
The total cost of filing GST returns includes several factors. Let’s break these down:
1. Professional Fees
Many businesses do not file GST returns on their own and instead hire professionals like accountants or GST experts to do the job. These professionals charge a fee for their services, which can vary based on the complexity of the returns and the size of your business.
- For small businesses, the fees can be as low as ₹500 to ₹2,000 per return.
- For medium-sized businesses, it may go up to ₹5,000 per return.
- For large businesses with more complex transactions, the cost can be ₹10,000 or more per return.
Professional fees are usually higher for annual returns or if the filing process is more complicated.
2. GST Software Costs
Some businesses use GST filing software to handle their returns themselves. These software solutions help simplify the process, reduce errors, and make sure everything is filed correctly. However, these software tools usually charge a subscription fee, which can range from ₹2,000 to ₹10,000 per year, depending on the features.
Using software can be a good option for businesses that want to avoid the higher costs of hiring a professional but still need help managing their GST returns efficiently.
3. Penalties for Late Filing
If you miss the deadline for filing your GST returns, you will have to pay a late fee. The penalty is ₹20 per day for NIL returns (where no tax is owed) and ₹50 per day for other returns. The maximum late fee can go up to ₹5,000 per return. This can add up quickly if you have multiple returns to file.
In addition to the penalty, you will also be charged interest at 18% per year on any tax you owe. This means the longer you delay, the more you will have to pay.
4. Interest on Late Payment
If you delay paying your GST after filing the returns, you will also be charged interest. The interest rate is 18% per year on the amount of tax you still owe. This interest is charged daily, so the sooner you pay your tax, the less interest you will have to pay.
5. Costs for Reconciliation and Auditing
If your business has many sales and purchases, you may need to do reconciliation before filing your returns. Reconciliation means matching your sales and purchases records with your returns to ensure there are no mistakes. This can be an extra cost if you hire someone to do it for you. Some businesses also need to get their returns audited, which can further add to the overall cost.
Can You File GST Returns for Free?
The government’s GST portal is free to use, but that doesn’t mean filing GST returns is completely free. Most businesses find it difficult to file returns on their own because of the complexity of the GST rules. That’s why many of them hire professionals or use software, which adds to the overall cost.
If you have a good understanding of GST rules and are confident you can file the returns correctly, you can save money by doing it yourself. But make sure everything is accurate because mistakes can lead to penalties and extra costs.
The Cost of Filing Mistakes
Filing your GST returns incorrectly can lead to extra charges. Mistakes such as incorrect tax calculations or mismatches in invoices can cause problems. You may need to file a revised return, which can be time-consuming and expensive, especially if you need professional help to fix the errors.
That’s why it’s important to make sure your returns are accurate before you file them. This can save you money in the long run by avoiding penalties and interest charges.
Charges for Filing Revised Returns
If you realize you made a mistake after filing your GST returns, you may need to file a revised return or add more details. This can also cost extra, especially if you need a professional’s help to correct the errors. It’s always better to get it right the first time to avoid the hassle and extra cost of revising returns later.
Are There Any Free GST Return Filing Options?
While the GST portal itself is free, the reality is that most businesses find the process of filing returns too complicated to handle on their own. Even though there’s no direct fee to file returns on the government’s site, the need for professional help or software makes it difficult to file for free. If you have a simple business with few transactions, you might be able to file for free, but most businesses find it worthwhile to pay for expert help.
Conclusion
Filing GST returns is an important task for businesses, but it comes with costs. While the government does not charge a direct fee for filing GST returns, businesses still face expenses such as professional fees, software costs, and penalties for late filing. These charges can vary depending on the size of your business, the complexity of your transactions, and whether you file returns on time. GST return filing charges will help you plan better and avoid unnecessary penalties and interest. Whether you choose to hire a professional or use GST software, the key is to make sure your returns are filed accurately and on time. This will help you stay compliant with the GST laws and avoid any extra costs associated with late or incorrect filings.
Also Read
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Frequently Asked Question
What are the main GST return filing charges?
GST return filing charges typically include professional fees for hiring accountants or GST experts, software subscription costs, penalties for late filing, and interest on delayed tax payments. These costs vary based on the size of the business, the complexity of returns, and whether the filings are done monthly, quarterly, or annually.
How much do professionals charge for GST return filing?
Professional fees for GST return filing can range from ₹500 to ₹10,000 or more per return, depending on the complexity of the filing and the business size. Small businesses may pay lower fees, while larger businesses with more transactions may need to pay higher amounts.
Is there a penalty for late filing of GST returns?
Yes, late filing of GST returns leads to a penalty. The penalty is ₹20 per day for NIL returns and ₹50 per day for other returns, with a maximum of ₹5,000. Additionally, an 18% interest per year is charged on any unpaid tax amount.
Can GST returns be filed for free using the government portal?
While the GST portal is free to use, most businesses prefer using professionals or software to file their returns. These services come with fees, so filing returns for free is rare, especially for businesses with complex transactions.
How much does GST filing software usually cost?
GST filing software typically costs between ₹2,000 to ₹10,000 per year, depending on the features and the business’s needs. These tools help businesses manage their returns efficiently by reducing errors and simplifying the filing process.
What happens if I make a mistake in my GST returns?
If mistakes are made while filing GST returns, businesses may need to file revised returns, which could incur additional costs. Mistakes can also lead to penalties or interest charges. It’s important to ensure accuracy before submitting the return to avoid these issues.
Do small businesses have lower GST return filing costs?
Yes, small businesses generally have lower GST return filing costs. They may spend less on professional fees and software since their transactions are simpler. However, they still need to pay penalties if returns are filed late.
What are the late fees for not filing GST returns on time?
Late fees for GST returns are ₹20 per day for NIL returns and ₹50 per day for other returns. The maximum late fee is ₹5,000 per return. If the tax is unpaid, an 18% interest rate per year is also charged on the overdue amount.
Can I avoid paying for professional GST filing services?
You can file GST returns on your own if you understand the rules and the filing process. However, many businesses prefer using professional services to avoid errors and penalties. If your business has simple transactions, self-filing might be an option.
Are there extra charges for filing revised GST returns?
Yes, filing revised GST returns can lead to extra charges, especially if professional help is needed. It’s important to double-check your return before submission to avoid the hassle and cost of making corrections later.