Late Fee Waiver for GSTR-9C from FY 2017-18 to 2022-23

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Clarification and Waiver on Late Fee for Filing FORM GSTR-9C

The 55th GST Council meeting, held on December 21, 2024, recommended several key measures to address compliance challenges faced by taxpayers. One notable recommendation pertains to late fees associated with filing FORM GSTR-9C (Reconciliation Statement) for past financial years. This measure aims to streamline compliance and provide relief to taxpayers who have faced delays in completing their annual GST filings.

Key Recommendations

1. Clarification on Late Fee Applicability

As per Section 47(2) of the CGST Act, 2017, a late fee is applicable for delays in filing the complete annual return under Section 44 of the CGST Act, 2017.
The complete annual return includes both:
- FORM GSTR-9 (Annual Return)
- FORM GSTR-9C (Reconciliation Statement), wherever applicable.
The GST Council has recommended issuing a circular to clarify this provision, ensuring that taxpayers understand the applicability of late fees for delays in filing both forms.

2. Waiver of Excess Late Fees for FY 2017-18 to 2022-23

To provide relief for past compliance lapses, the GST Council has proposed:

A waiver of the excess late fee for delayed filing of FORM GSTR-9C for financial years 2017-18 to 2022-23.
The waiver will apply to late fees beyond the amount already payable for delays in filing FORM GSTR-9 (Annual Return) for the same financial years.
The condition for availing this waiver is that FORM GSTR-9C must be filed on or before March 31, 2025.

Implications of the Recommendations

Simplified Compliance:
- Taxpayers who missed filing FORM GSTR-9C due to financial or operational constraints can now regularize their filings without incurring prohibitive late fees.
Clarity in Tax Law:
- By explicitly linking the late fee provisions of FORM GSTR-9C with FORM GSTR-9, the recommendation removes ambiguity about the calculation of late fees.
Encouragement for Compliance:
- The waiver for FY 2017-18 to 2022-23 provides an incentive for taxpayers to clear their backlogs and comply with GST requirements before the March 31, 2025, deadline.

Next Steps

The GST Council’s recommendations will be implemented through a separate notification under Section 128 of the CGST Act, 2017. Taxpayers are advised to:

Monitor notifications and circulars issued by the GST authorities to understand the exact procedural requirements.
Ensure timely filing of FORM GSTR-9C for the applicable financial years to benefit from the waiver.