Penalty for Nonfiling of GST return (GSTR 1 and GSTR 2) – Late fees for not filing of outward and inward return

1.0 Introduction – Late fees

If any registered person fails to furnish details of outward or inward supplies of return before the due date then he shall be liable to pay the penalty (late fees) of Rs.200 per day subject to a maximum of Rs.10,000/-.

The taxpayers might think that as per law only Rs.100 has been prescribed, then how can the penalty or late fees be Rs.200? The answer itself lies in the GST law. Rs.100 has been prescribed in CGST act and Rs.100 has also been prescribed under SGST act. Hence, in total it is Rs.200 per day.

2.0 Ignoring the returns could be very costly under GST

To understand this point, let us assume an example. Suppose, Ram takes GST registration in the month of July and starts his business from the same month. However, he somehow forgets to file the GSTR 1, 2 for the month of July and August. Now, let us calculate the maximum penalty Mr.Ram has to bear.

Since he has not filed 4 return under GST (2 returns for July and 2 for August), and maximum penalty prescribed is Rs.10000 per penalty. Therefore, the maximum penalty of Rs.40,000 shall be levied upon Mr.Ram.

3.0 Due date for filing the GSTR 1 and 2

Ideally, the GSTR 1 and 2 shall be filed by the 10th or 15th of the following month. However, the central government holds all the power to extend the due date if the same is necessary. Like, the government has already done in case of July and August 2017.

4.0 General penalty

For any contravention of any provision of GST for which no penalty has been prescribed, the general penalty of Rs.25,000 shall be levied.

5.0 Conclusion

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