Time limit for filing GST return coming soon: Filing will not be allowed after 3 years of due date, it's time to file any pending returns

The Goods and Services Tax Purple (GSTN) has issued a new notice informing taxpayers that the GST portal will soon implement a change that prohibits filing specific GST returns after three years have passed from the due date. GSTN also mentioned that these changes, which involve restricting filing of GST returns after three years, will come into effect on the GST portal from early next year (2025). Therefore, we recommend that you review your tax records and submit any pending GST returns immediately if there are any that have not yet been filed.

“According to the Finance Act, 2023 (8 of 2023), dt. 31-03-2023, implemented with effect from 10-01-2023 vide Notification No. 28/2023 – Central Tax dated 31 July 2023, taxpayers will not be able to file their GST returns after the expiry of a period of three years from the due date to file such return under Section 37 (Foreign Supply), Section 39 (payment of liability), Section 44 (Annual Return) and Section 52 (Tax Collected at Source). These sections cover GSTR-1, GSTR 3B, GSTR-4, GSTR-5, GSTR-5A, GSTR-6, GSTR 7, GSTR 8 and GSTR 9. Such changes will be implemented on the GST portal from early next year. year (2025). Therefore, taxpayers are advised to reconcile their records and file their GST returns at the earliest if they have not filed till now,” GSTN said in a notice dated October 29, 2024.

What will happen if you do not act on this notice?

Chartered accountant Bimal Jain, founder of A2Z Taxcorp LLP, says he will be considered a non-compliant of the GST law if he fails to file mandatory GST returns. “This notice is relevant to those taxpayers who wish to file any late GST return and relates to a period of three years from the due date of filing of such return. The GST department is being generous in giving taxpayers more time to file their pending GST returns as this current notice refers to an amendment implemented last year on October 1, 2023. This is a good notice from GSTN and will help taxpayers save trouble with GST demand notices and other problems that occur when a mandatory GST return is not filed,” says Jain.

Jain says that a potential problem for taxpayers who do not file a late GST return and are time-prescribed by the GST portal is that the GST department could begin a best judgment assessment.

“The GST department will get its information through its own sources, third parties, its books of accounts and others and then pass a best judgment assessment order to the best of its ability. Now, this evaluation can also be a problem for taxpayers. For example: Merienda the best judgment assessment is completed, if the department determines that the taxpayer has any outstanding GST which has not yet been deposited, a tax demand notice will be issued,” says Jain.