Amnesty Scheme Announced In 43 GST Council Meeting Held On May 28, 2021
Table of Contents
- What is Amnesty Scheme
- Frequently Asked Questions (FAQs) on Amnesty Scheme
What is Amnesty Scheme:
In the meeting finance minister, Mrs. Nirmala Sitharaman also announced about “Amnesty scheme” along with few other announcements which were later approved by GST Council.
According to the Finance Minister, this amnesty scheme under GST is announced with an objective to provide relief to the small taxpayers and also to reduce the compliance burden of GST for both small and medium taxpayers.
Amnesty Scheme of 2021, is a limited-time opportunity for a specified group of taxpayers to pay a defined amount, in exchange for forgiveness of tax liability (including late fees, interest, and penalties) relating to a previous tax period or periods and without fear of criminal prosecution. Tax amnesty is one of the voluntary compliance strategies to increase the tax base and tax revenue.
On 28th May’2021, Friday GST council’s 43rd meeting took place which was long due from February ’2021. So, after a gap of about 7 months (last held in Oct’20) finally, the meeting took place.
There were a lot of speculations around this scheme and finally the scheme is out.
In the GST context, the Amnesty scheme aims to provide relief to taxpayers regarding the late fees for pending returns. Here are the few FAQs on GST Amnesty Scheme 2021 :
Ques 1: For which period GST amnesty scheme is applicable?
Ans: From July’17 to April’21
Ques 2: GST amnesty scheme is available to which GST return?
Ans: GSTR-3B
Ques 3: GST amnesty scheme is not available to which GST return?
Ans: GST amnesty scheme is not available for GSTR-1
Ques 4: How much maximum late Fees per return may be charged?
Ans: Case 1: Does not have any Tax liability: Maximum late fees per return is Rs. 500 (Rs.250 CGST+Rs. 250 SGST)
Case 2: Any other case: Maximum late fees per return is Rs. 1000 (Rs.500 CGST+Rs. 500 SGST)
Ques 5: To avail amnesty scheme, when GST Returns have to be filed?
Ans : GSTR-3B for tax period July’17 to April’21 if has not been filed then it has to be filed between 01-06-2021 to 31-08-2021 to avail the benefit of amnesty scheme
Ques 6: Even though the amnesty scheme has been made applicable then also we are getting late fees of more than Rs.500/Rs.1000 while filing GSTR-3B for the period July’17 to April’21
Ans: It’s correct. To explain this take an example.
Example: Mr. M has not filed GSTR 3B from Aug’2020 onward. And GSTR-3B for the month of July’2020 was also filed 70 days late. Now in this case when he starts filing his GSTR- 3B from Aug’2020 onwards to take the benefit of the amnesty scheme then while filing GSTR-3 B for the month of Aug’2020 he will get late fees of more than Rs.500/Rs.1000. This happens not because of any technical glitches or portal issues but because Mr. M has filed GSTR-3B for the month of July 2020 before the start of the amnesty scheme, i.e., 1st June ‘2021, and as we know that last month late fees of GSTR-3B is auto calculated and paid while filing GSTR-3B of next month that’s why late fees is reflecting more than Rs.500/Rs.1000.
Ques 7: Is the amnesty scheme also available for the interest of GST Liability?
Ans: No, the amnesty scheme shall not be available for the interest of GST Liability.
Ques 8: If the assessee is filing his pending GSTR-3B from July’17 to April’21 then can he also claim ITC?
Ans: For FY 2017-18, the last date for availing ITC is 23rd April’19, for FY 2018-19, the last date for availing ITC is 20th Oct 2019 and for FY 2019-20, the last date for availing ITC is 20th Oct 2020/22nd Oct 2021/24th Oct 2021* but till now the last date for availing ITC for FY 2020-21 is 20th Oct2021/22nd Oct 2021/24th Oct 2021* (as per section 16(4) of CGST Act), thus assess can claim ITC from April 2020 onward only as ITC for rest of the period has become time-barred.
As a result, for FY 2017-18, 2018-19, and 2019-20, assesse cannot claim ITC and GST liability has to be discharged only in cash along with interest at the rate of 18% p.a.
*Dates vary as per turnover and States.
As per the general parlance of law, if the assessee has already paid the late fees, then govt will not refund it unless otherwise mentioned.
Note: More clarifications may be available once the notification will be published.