Advisory in respect of Changes in GSTR 8
Understanding the Recent Amendments to TCS Rates under GST and Their Implications
The Goods and Services Tax (GST) Council has announced a significant reduction in the Tax Collected at Source (TCS) rate, effective from July 10, 2024. This change is outlined in Notification No. 15/2024 dated 10.07.2024. The amendment is aimed at simplifying the tax regime and easing the financial burden on businesses. This article delves into the specifics of the TCS rate change, the implications for businesses, and the advisory issued for taxpayers.
What is GSTR-8?
GSTR-8 is a monthly return that must be filed by e-commerce operators who are required to collect TCS under GST. It contains details of supplies made through the e-commerce platform, along with the amount of TCS collected on such supplies.
Key Features of GSTR-8:
• Monthly Filing: GSTR-8 is filed on a monthly basis by e-commerce operators who are liable to collect TCS.
• Details Included: The return includes the details of outward supplies made through the e-commerce platform, TCS collected, and the amount payable to suppliers.
• Compliance Requirement: Filing GSTR-8 is mandatory for e-commerce operators to ensure compliance with the GST law, and failure to do so can result in penalties.
Amendment in TCS Rate
Old TCS Rate (1st July - 9th July 2024):
• The TCS rate prior to the amendment was 1% (0.5% CGST + 0.5% SGST/UTGST or 1% IGST).
• Taxpayers were required to collect and report TCS at this rate for all transactions occurring between July 1 and July 9, 2024.
Revised TCS Rate (Effective from 10th July 2024):
• From July 10, 2024, the TCS rate has been reduced to 0.5% (0.25% CGST + 0.25% SGST/UTGST or 0.5% IGST).
• This reduction aims to provide relief to taxpayers by lowering the tax burden and promoting compliance.
Advisory for Taxpayers
Due to the change in the TCS rate, some taxpayers have reported validation errors while filing GSTR-8 for July 2024. In response, the GST Network (GSTN) team is actively working to incorporate the necessary changes in the GSTR-8 return filing process.
• Validation Errors: Some taxpayers have experienced validation errors while filing their GSTR-8 returns for July 2024. This is due to the changes in the TCS rate and the need for system updates.
• Resolution Timeline: The GSTN team is expected to complete the necessary updates within a few days, allowing taxpayers to file their returns from August 6, 2024, midnight onwards.
Disclaimer: This material and the information contained herein is intended for clients and other Chartered Accountants to provide updates and is not an exhaustive treatment of such subject. We are not, by means of this material, rendering any professional advice or services. It should not be relied upon as the sole basis for any decision which may affect you or your business.
