The Government of India extends two types of GST registration to taxpayers in the country – Regular GST registration and Composition Scheme registration. The Composition Scheme allows dealers to file a GST return on an annual basis through Form GSTR 4.
What is GSTR 4 Annual Return?
GSTR 4 is an annual return form containing the details of inward and outward supplies of a composition dealer. It was introduced through the Third Amendment, 2019, to GST Rules 2017. Until the financial year 2018-19, the law required taxpayers to file a GSTR 4 return every quarter. However, Form GST CMP-08 replaced this quarterly return form, and GSTR 4 annual return was set in motion.
By opting for Composition Scheme, a taxpayer can file a GSTR 4 once a year, unlike regular taxpayers who furnish returns on a monthly or quarterly basis.
Particulars under GSTR 4
The revised annual Form GSTR 4 consists of nine sections. A rundown of their contents is discussed below:
- Table 1-3
Tables 1-3 contain the basic information about a taxpayer, such as the name of the individual, his/her GSTIN, aggregate turnover in the preceding financial year, ARN and date of ARN. These particulars are auto-populated at the time of filing return.
- Table 4
Taxpayers are required to provide the details of their inward supplies in this section. It is divided into four subsections as mentioned below –
- 4A: It contains the details that a composition dealer receives about supplies from a GST-registered supplier. This list of supplies includes both intrastate and interstate transactions on which the reverse charge cannot be applied.
- 4B: This part has the details of supplies received by a composition dealer from a registered supplier, including both intrastate and interstate transactions. However, these supplies must attract a reverse charge.
- 4C: A taxpayer provides information about an unregistered supplier’s supplies in this section, including both intrastate and interstate supplies.
- 4D: This section calls for details of all taxable import services on account of applicability of a reverse charge.
- Table 5
This table auto-populates the summary of one’s liability by way of self-assessment as per Form GST CMP-08. It consolidates the CMP-08 forms’ payment details filed in a given financial year, including details of payment made on inward supplies that attract reverse charge, outward supplies, interest paid, and amount of tax.
- Table 6
Under this table, composition dealers are required to furnish details of their outward supplies as well as inward supplies wherein a reverse charge is applicable. Alongside these details, table 6 also calls for the details of tax, such as the rate and amount of tax. However, amounts of IGST, CGST, SGST and Cess gets auto-populated.
- Table 7
Here, taxpayers need to enter the GSTIN of the deductor/e-commerce operator, their gross invoice value, and the amount of TDS deducted. Any TDS/TCS received from a supplier or e-commerce operator gets auto-filled in this table.
- Table 8
It contains information on tax, interest and late fee, both payable and paid. It contains the following particulars:
- Payable tax amount: It gets auto-populated from GSTR 4’s table 6.
- Tax amount paid: This detail is auto-filled as per Form CMP-08.
- Balance tax payable: It is the difference between the above two amounts of tax.
- Amount of interest payable and paid: It contains the interest payable or paid for filing returns late.
- Amount of late fee payable and paid: It contains the late fee payable on delayed GST payment and the amount already paid. Composition taxpayers are charged a late fee of Rs. 200 per day after the due date, not exceeding Rs. 5,000.
- Table 9
This table allows taxpayers to claim a refund on taxes, in the circumstances wherein excess taxes are paid. This refund amount gets divided into the following:
GSTR 4 Due Date
Composition dealers file a GSTR 4 on an annual basis. The due date of filing it is April 30th of the financial year, succeeding the year for which taxpayers are filing the GSTR 4 annual return. However, this GSTR 4 due date extended several times for the financial year 2019-20, as follows:
- GST Notification No. 34/2020 extended the due date to July 15th, 2020.
- This date was further extended to August 31st, 2020, via GST Notification No. 59/2020.
- The due date was finally extended to October 31st, 2020, via GST Notification No. 64/2020.
GSTR 4 Filing
One can easily file a GSTR 4 online on the GST portal by following these steps:
- Log in to the GST portal.
- Navigate through options Services > Returns > Annual Return.
- Under the ‘File Annual Returns’ button on the dashboard, select the relevant financial year.
- Read the instructions on this page carefully. Then, select the ‘PREPARE ONLINE’ option.
- Enter all relevant information in the various tables of GSTR 4, as discussed above.
- After entering the necessary details, review the updated GSTR 4 return by clicking on either ‘DOWNLOAD GSTR 4 SUMMARY (PDF)’ or ‘DOWNLOAD GSTR 4 (EXCEL)’ button.
- Select the declaration checkbox and authorised signatory. Then click on the ‘FILE GSTR 4’ button.
- A warning message appears on the screen. Select ‘YES’ on it, then select either ‘FILE WITH DSC’ or ‘FILE WITH EVC’.
After the completion of the above procedure, the status of return changes to ‘Filed’. Additionally, a taxpayer receives an Application Reference Number (ARN) and a confirmation message via SMS or email registered with their GST portal.
Applicable Tax Rates under Composition Scheme
Composition Scheme allows taxpayers to pay GST at a fixed rate of turnover, thereby eliminating the tedious GST formalities. The table below elaborates on the tax rates applicable for composition dealers:
|Business Type||SGST (%)||CGST (%)||Total (%)|
|Manufacturers/ Traders of goods||0.5||0.5||1.0|
|Restaurants (not serving alcohol)||2.5||2.5||5.0|
|Other service providers||3.0||3.0||6.0|
A taxpayer can opt for Composition Scheme and file a GSTR 4 if his/her turnover is less than Rs. 1.5 crores. For North-Eastern states and Himachal Pradesh, this limit is lowered to Rs. 75 lakh. The Government of India, by way of this scheme, simplifies the process to file returns for taxpayers.