Every new year comes with new hopes, desires, and responsibilities along with challenges. Introduction of Goods and Services Tax (GST) has been a big tax reform in India. From 2017-2019 it has been a great year for GST. Even in between the GST rate move down from 28% to 18% on 178 goods. Goods and Services Tax (GST) being an indirect tax applied in India on the supply of goods and services. It is a large, multistage, destination-based tax: comprehensive because it has a mixture of almost all the indirect taxes except a few state taxes. In 2020, taxpayers have to keep 15 things in mind. 2020 is a Leap year, to jump forward taxpayers require to abide tax laws in business. In this article, we will discuss some trend setting tax reforms coming and will transform the dynamics of the business in India. We will see GST in 2020 as improved and developed.

Major Taxpayers should keep the following 15 things in the mind of GST in 2020 along with Income Taxation :

  • Mandating E-invoice

The introduction of a new E-invoicing system from 1st April 2020  will be implemented in GST. That will become mandatory for all taxpayers having annual turnover more than Rs.100 Crore and then slowly to every B2B ( Business to Business) suppliers in the Future. A device for the continuous upload of revenue invoices on a real-time base. This is the most extraordinary transformation coming in Indian Book Keeping.

  • New IRP( Invoice Registration Portal) in GST

The Invoice Registration Portal will be introduced in 2020. The formation of e-invoice will be the responsibility of the taxpayer who will be expected to report the same to the Invoice Registration Portal (IRP) of GST. The QR Code will include vital parameters of the e-invoice and return the same to the taxpayer who created the document in the first place. In simple words, IPR will make e-invoice of the invoices uploaded by the supplier. IRP will further send the e-invoice to the supplier and recipient. IRP also will send e-invoices data to the GSTN portal.
  •  Refusal of late fees for Non-filing of GSTR-1

From 2020, its important point to keep in mind- If the taxpayer fails to file GSTR-1 from July 2017 to 2019. The taxpayer can file such a return till 10 January 2020. Late fees for the same will be rejected. This will in the future affect the GSTR-2A of the recipients to clam ITC (Input Tax Credit) the backbone of the GST regime.

  • New formations in GST Return

From 1st April 2020 for all taxpayers new simplified automatic system for GST returns will be seen. The new GST return points at improving the clarity and efficiency of the return filing process. The Council has resolved that the new return filing system will be part of 2020. The new return system is devised to clarify and make good the ITC claim process, what is now beginning to concern taxpayers is how balancing entries will need to be passed in case of ITC reversals. ITC will now get automatically credited to the electronic credit ledger of the receiver. This new returns system will develop compliance and decrease the tax evasion to a larger extent.

  • Annexure 1 and Annexure 2

GST in 2020 has brought, Annexure-1 of Outward Supplies and Annexure-2 of Inward Supplies will be the future base for filing of all GST Returns. Thus these 2 reports will be the key for future reports of GST which will replace GSTR 1 and GSTR-2A.
  • Restriction on a claim of ITC

GST in 2020 brings out -The Decision made in the 38th GST council, central board of indirect taxes & customs has stated a specific amendment in CGST Rules ( Central Good & services Tax rules, 2017) decreasing the percentage of eligible ITC available for Availment, the suppliers of GSTR-1 will not be allowed to see details. With effect from 01/01/2020, ITC in respect of invoices or debit notes that are not reflected in taxpayer’s FORM GSTR-2A shall be restricted to 10 percent of the eligible ITC reflected in his Form GSTR-2A. Earlier the restriction was 20%. A major change in ITC availment. Therefore now, the facility to avail ITC in respect of invoices or debit notes, the details of which have not been uploaded by suppliers in GSTR-1 has been further restricted to only 10% of the total eligible credit.

  • Blocking of a generation of E-way Bills

Notification No. 75/2019 – Central Tax dated December 26, 2019- Rule 138E of the CGST Rules is improved to give the e.f. January 11, 2020, non-filing of GSTR-1 for 2 following months/quarters would also block the generation of E-way Bill. Thus, the regular filing of GSTR-1 and GSTR-3B in the year 2020 will go hand in hand.
  • GST Audit and Annual Return

GST in 2020 introduced, the due date for filing GST Annual Return i.e. GSTR – 9 and Audit Report, Reconciliation Statement i.e. GSTR – 9C for the F. Y. 2017-18 has been further prolonged to January 31, 2020.
Moreover, the due date for filing GSTR – 9 and GSTR – 9C for the F.Y 2018-19 has been stretched to March 31, 2020.

  • DIN Notice and E-scrutiny 

Due to a decline in collection of revenue from GST, large scale e-scrutiny and e-assessment notices with DIN for the returns from July 2017 may be taken up. It would be done in order to check significant deviations in returns.

 Circular No. 128/47/2019- GST dated December 23, 2019, has directed that electronic generation and quoting of DIN will be made in respect of all communication including e-mails sent to the taxpayers and other associated person by any office of CBIC over the country and is efficient since December 24, 2019.

  • GSTN Network

GSTN Network is proposed to be reengineered for more taxpayer-centric services like a reminder of return filing, the status of a refund, ITC matches and mismatches, etc.
  • Making QR Codes for Business to customer(B2C) supplies 

In 2020, Notification No. 71/2019 – Central Tax and Notification No. 72/2019 – Central tax, both dated December 13, 2019, and April 01, 2020. Quick Response Code (“QR Code”) will be compulsory in the case where the invoice is allowed by a registered person, whose aggregate turnover in a financial year exceeds Rs. 500 crore, to an unregistered person (B2C invoice).
But, where such a registered person makes a Dynamic QR Code available to the recipient by a digital display, such a B2C invoice circulated by such a registered person including cross-reference of the payment using a Dynamic QR Code, shall be considered to be having QR Code.

  • New ITR rules 

The new ITR with self-filled details of Salary, TDS, etc is proposed for the salaried employees which aim at simplified returns for assesse.

  • Change in Income Tax online assessment

The several significant changes in 2020 under Income Tax will be the new online assessment which is a technology-driven and faceless assessment system over India. The suggested due date for e-assessment for F.Y. 2017-18 is 30th September 2020. It affects the tax authorities and taxpayers at huge.

  • Reverse charge on renting of Motor Vehicles 

 RCM will be applicable to the service by way of renting of any motor vehicle designed to carry passengers. Where the cost of fuel is included in the charge from the service recipient. Only if the supplier fulfills all the following conditions is other than a body-corporate or does not issue an invoice charging GST @12% from the service recipient. Also,

(c) supplies the service to a body corporate located in the taxable territory.

It is clarified that the above amendment of the RCM Notification is merely clarificatory in nature and, hence, must also apply for the period October 1, 2019, to December 31, 2019. Even from the above changes and new system getting operational in the New Year 2020.

  • Extending the due dates for filing of TRAN-1 & 2

The due dates have been extended to March 31, 2020, to April 30, 2020, for furnishing Form TRAN-1 & TRAN-2 by the registered taxpayers. Notification No. 02/2020 – Central Tax dated January 1, 2020.

Taxpayers have celebrated the new year. But there are many hardships in the form of compliance awaiting in this 2020. Let us hope taxpayers overcome all the hardships and have an amazing year with GST in 2020.

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