GSTR 7

What is GSTR-7?

GSTR-7 is required to be filed by every person who is liable to deduct TDS under GST.

GSTR-7 contains details of TDS deducted, any amendments to it thereof, TDS liability payable  and paid, TDS refund claimed if any, etc.

The provisions of TDS on GST are applicable from 1st October, 2018 vide NN 50/2018- Central Tax dated 13th September, 2018.

Who is required to deduct TDS and file GSTR-7?

The following persons are required to deduct TDS under GST –

  • A department or establishment of the Central or State Government, or
  • Local authority, or
  • Governmental agencies, or
  • Persons or category of persons as may be notified, by the Central or a State Government on the recommendations of the Council.

The following persons are notified through Notification No 33/2017- Central Tax, dated 15th September, 2017 –

  • An authority or a board or any other body which has been set up by Parliament or a State Legislature or  by a government, with 51% equity ( control) owned by government
  • A society established by the Central or any State Government or a Local Authority and the society is registered under the Societies Registration Act, 1860
  • Public sector undertakings

Note – In other words we can say that, all undertakings that are controlled by Central Government, State Government or a local authority are covered under this provision.

No TDS to be deducted if the payment is made by a person who is not mentioned in the above mentioned list.

When shall TDS not be deducted?

It is imperial to understand that TDS is required to be deducted only if payment is made or credited to the supplier by the above mentioned entities. If payment is made by any other than mentioned above, no TDS shall be deducted while making payment to the supplier.


The following are the two cases where TDS shall not be deducted –

1. Contract value does not exceed Rs. 2.5 Lakhs

If the aggregate contract value by an individual supplier does not exceed Rs 2.5 lakhs, TDS is not required to be deducted.

Example – Mr X enters into a contract with a public undertaking for providing services worth Rs 3 lakhs. With regards to this, Rs 1.5 lakhs is received as advance in FY 2018-19 and remaining payment of Rs 1.5 lakhs in FY 19-20.

In this case, provisions of TDS will apply as the total contract value exceeds Rs 2.5 lakhs.

2. Location of Recipient is different from Location of supplier and Place of Supply

TDS shall not be deducted if location of recipient is different from location of supplier and place of supply. While determining the applicability of provisions of TDS, it is important to know place of supply.

Example -

  • Location of Recipient – Delhi
  • Location of Supplier – Haryana
  • Place of Supply – Haryana

In the above example, TDS shall not be applicable as location of recipient is different from location of supplier and place of supply

Example -

  • Location of Recipient – Maharashtra
  • Location of Supplier – Gujarat
  • Place of Supply – Maharashtra

In this case, TDS will be applicable and IGST shall be deducted.

Due Date for filing GSTR-7 

Due date for filing GSTR 7 is 10th of the following month in which the amount of TDS is deducted is by the deductor. Return once filed cannot be revised.

Due date for filing return for the month of October shall be 10th November.

Penalty for Non-Compliance

Penalty for Non-Compliance of TDS Return

TDS is not deducted

Interest to be paid @18% along with TDS amount. Where such amount is failed to be paid voluntarily, such amount as determined by law shall be payable.

TDS deducted but not paid or late paid

Interest to be paid @18% along with TDS amount. Where such amount is failed to be paid voluntarily, such amount as determined by law shall be payable.

Late filing of TDS return

Deductor is liable to pay penalty Rs 100 per day CGST and Rs 100 per day SGST in case of delay in filing of return, subject to a maximum of Rs 5000.

Delay or failure in issuing TDS certificate

Where the deductor fails to issue or delays in issuing TDS certificate to the deductee within 5 days from filing the return, he shall be liable to pay a late of Rs 200 per day (Rs 100 CGST and Rs 100 SGST), subject to a maximum of Rs 5000.

Any excess or erroneous amount deducted and paid to the Govt shall be dealt for refund under Section 54. However, if the deducted amount is already credited to the electronic cash ledger of the supplier, the same shall not be refunded.

TDS Certificate

Every deductor (i.e. the recipient) is required to issue a TDS certificate in GSTR-7 to the deducted  (i.e. the supplier) within 5 days of depositing TDS to the Government.

The TDS so deducted is visible to the supplier under separate form “TDS and TCS received” on the returns dashboard.

The supplier has to accept or reject these entries that are reflected in this form. Once these records are accepted, they are reflected in GSTR 2A under Part C and the amount is credited to the electronic cash ledger.

Details to be provided in GSTR-7 

GSTR 7 details
1

GSTIN and Business Name

GSTIN, legal name and trade name of the deductor deducting TDS is auto populated at the time of filing return.

2

Details of tax deducted at source

The following details are mentioned in this section

  • GSTIN of the deductee 
  • Amount of payment made to the deductee on which TDS is charged,
  • The amount of TDS deducted (IGST, CGST or SGST)
3

Amendments to details at tax deducted at source in respect of any earlier tax period

Where an error is made in the earlier tax period, rectifications can be made to the same by updating details in this section. The following details are required in this section

  • original and revised details of the GSTIN of the deductee
  • Amount paid to the deductee on which TDS is deducted and
  • The amount of TDS deducted

In case, a record is rejected by the deductee, the same entry is reflected in amendment section “Rejected by Deductee”.

4

Tax deduction at source and paid

This section includes the details of TDS deducted (IGST / CGST or SGST) from the payment made to the supplier. It also includes corresponding amount of TDS made to the Government from electronic cash ledger. TDS payable has to be discharged in cash only.

5

Interest, late fee payable and paid

Details of interest and late fees payable and paid on TDS amount is required to be declared here.

6

Refund claimed from electronic cash ledger

Where a deductor wants to claim refund of TDS paid from his electronic cash ledger, details must be mentioned here. The following details are to be mentioned

  • Amount of tax (IGST / CGST / SGST) including interest, late fee to be refunded
  • Debit entry numbers for payment made
  • Bank account details
7

Debit entries in electronic cash ledger for TDS/interest payment [to be populated after payment of tax and submissions of return]

This section is auto populated after the deductor files his TDS return and makes payment of TDS along with interest. This number is based on debit entry made in the electronic cash ledger for payment of TDS.


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