In a recent development, the Goods and Services Tax Network (GSTN) has issued an advisory regarding the mandatory sequential filing of GSTR-7 returns. This change follows the provisions laid out in Notification No. 17/2024-Central Tax, dated 27th September 2024, and is effective from 1st November 2024.
The advisory has been issued in response to multiple queries received by the GSTN regarding the sequential filing process, with some taxpayers referencing earlier FAQs that stated sequential filing was not mandatory. Here’s a detailed explanation of the new requirements and how they impact taxpayers.
Key Points of the Advisory
1. Mandatory Sequential Filing for GSTR-7
- Starting with the tax period of October 2024, taxpayers filing Form GSTR-7 (for TDS under GST) must do so in chronological order.
- Returns for a particular tax period cannot be filed unless all previous tax period returns have been submitted.
2. Nil Returns Are Required
- For months in which no TDS deductions have been made, taxpayers are required to file a Nil Return in GSTR-7 to ensure compliance with the sequential filing requirement.
3. Applicability of Sequential Filing
- This mandate applies to all GSTR-7 returns filed from 1st November 2024 onwards. Taxpayers who missed filing earlier returns must first complete those filings in chronological order before proceeding with the October 2024 return.
Resolving Misunderstandings
The confusion among taxpayers arose because earlier FAQs mentioned that sequential filing was not mandatory. However, with the issuance of Notification No. 17/2024, the rules have been updated to mandate sequential filing. Taxpayers are advised to follow the latest advisory and ensure compliance to avoid any disruptions in return filing or penalties for non-compliance.
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