GST Return Filing for online sellers is a mandatory requirement under the GST Act. Unlike other businesses, its applicability for online sellers does not depend on annual turnover. Moreover, online sellers have to file multiple GST returns on a monthly, quarterly, and annual basis to remain compliant. In this blog, we have explained all the forms, documents and steps required for this purpose.
Online Sellers are basically businesses that sell their products through ecommerce aggregators. They’re liable to pay GST on their sale at the same tax rates applicable to other brick and mortar businesses. Even most of the return filing requirements, forms, and processes are the same. The only difference between GST Return filing by online and offline sellers is that the former is not exempt for lower turnover. Though this raises the tax burden for online sellers, their formalisation within the GST regime is a major advantage.
Who are Online / Ecommerce Sellers?
Online Sellers sell their goods and services electronically through e-commerce platforms run by E-commerce operators like Amazon, Flipkart, Meesho, Myntra, and so on. They operate quite similarly to their offline counterparts with the only difference being in their mode of sale and the place of supply. While online sellers have their products sold on a digital medium, offline sellers actually have a physical store for this purpose. Moreover, the place of supply for offline sellers is limited to where the demand is generated or where the customer places an order. On the contrary, online sellers can sell their products to different markets expanding across borders. To sum up, while offline sellers are quite restricted to their location, an expansion of their business can only be achieved if they shift to online selling.
Eligibility for Filing Ecommerce Seller GST Return
Online sellers are eligible to pay GST and file GST Returns, regardless of their turnover. While the CGST Act sets certain limits for GST registration and compliances, such limits are not applicable to online sellers. In other words, online filing of GST return is mandatory for ecommerce sellers in India. However, they do have an option to register either under the regular or the composition scheme. Let’s understand the difference.
The regular GST scheme for online sellers does not have any criteria for enrollment. It follows the usual regulations and obligations under the GST Act, like monthly GST Return filing, annual GST return filing, and the standard GST rates applicable between 5% to 18%. On the other hand, the GST composition scheme for online sellers targets low income taxpayers. It relaxes the GST compliance regulations for them, thereby easing the tax burden and cost of operations. For enrolling under this scheme, online sellers must have an aggregate annual turnover up to Rs.1.5 crores. GST return under the scheme is filed monthly and annually, whereas the tax rates have a low range between 1% to 6%.
GST Return Filing Forms for E-commerce Online Sellers
GST return for ecommerce sellers are filed in the same forms applicable to offline sellers. These include GSTR1, GSTR3, GSTR 9/9C, and GSTR 5. Each of these forms are filed at different due dates, and for a distinct purpose. Let’s discuss what they entail.
GSTR 1: It is filed as a statement of outward supplies or sale made by online sellers. Usually, the return is due every month, unless the seller has opted for the QRMP scheme, in which case it is filed quarterly. GSTR 1 is a mandatory filing, even if the online seller has not generated any business during the said tax period. However, in such a case, the seller can file a nil. return. Additionally, if the online seller is a non-resident or is supplying OIDAR services, he will be exempt from filing GSTR 1 return.
GSTR 3B: It is filed as a statement summary of GST liabilities during a specific tax period. If an online seller has opted for the QRMP scheme, the return will be due at the end of a quarter. For all other cases, the return shall be due every month. It is mandatory to file GSTR 3B even if the online seller has not registered any business activity. The option to file nil return is available.
GSTR 9 / GSTR 4: These are mandatory annual GST returns filed by online or ecommerce sellers. While the GSTR 9 return is filed by the regular taxpayers, the GSTR 4 return is filled by online sellers registered under the Composition Scheme. Filing annual return is mandatory for all online sellers except NRIs, casual taxpayers, and those selling OIDAR services. It contains crucial information like tax payable by online sellers, the amount of tax paid, inward supplies, outward supplies, GST exempt supplies, refund claims, ITC claims and more.
GSTR 9C: GSTR 9C is a Reconciliation Statement filed only if the annual turnover of online sellers exceeds Rs.5 crores. The statement reconciles the financial details in GSTR 9 return with the annual account books of the online selling business. It is filed annually with the GSR 9 return itself.
GSTR 5: GSTR 5 return is a monthly statement filed by a non-resident online seller or e-commerce companies reporting their business transactions in India. This includes both outward and inward supplies. It is filed in the place of GSTR 1 monthly return, and is due every month as well.
GSTR 5A: If the online seller is selling OIDAR (Online Information and Database) services, it is mandatory to file the GSTR 5A return every month. GSTR-5A is a replacement of GSTR 1 return for OIDAR service providers, both resident and non-resident in India.
IFF & QRMP Scheme: Online Sellers can opt for QRMP scheme and go for quarterly return filing if their aggregate annual turnover is up to 5 crores. Additionally, those opting for the QRMP scheme have to upload their invoices through the IFF facility as well.
How To Do GST Return Filing of Online Sellers?
The GST Return Filing Process for online sellers is the same as that for offline sellers. Based on the scheme opted for, the return can be filed online on the official GST website www.gst.gov.in. However, a prerequisite is the availability of GST Registration Number or GSTIN. This is a 15-digit number generated after GST registration of the online seller. Learn more about the process to file online GST return from our experts! Once the online seller has been allotted a GST Number, he can begin the GST return filing process on the GST website. Here are the steps that must be followed:
- Login to the GST Portal with valid user ID and Password.
- Go to the Return Dashboard under the “Services”tab and enter the return filing period as well as the relevant financial year.
- All pending returns of the online seller for the mentioned tax period will appear.
- Click on the return that’s supposed to be filed.
- Fill GST return online with all the required details correctly, and save the form. A copy can be downloaded, if required.
- Next step is to pay GST return online. For this, the form has to be submitted first. Check the status to ensure the same. Then, click on the tax payment option and proceed with checking the e-cash ledger balance. If there’s enough balance, use it to offset the GST liability, else generate an online challan and pay through net banking, cheque, or demand draft. The payment can also be made partially through both channels combined.
- Lastly, select the authorised signatory’s name, and verify the return using DSC or EVC. This completes the GST Return filing process for online sellers.
Documents for Filing GST Return Online By Ecommerce Sellers
The documents for filing GST Return online by ecommerce sellers depends on the type of return being filed. However, certain documents must be kept handy in every case. These are the common paperwork required to file any GST returns regardless of the form being used. Here’s a brief list.
- GST Invoice
- GSTIN
- UIN, if applicable
- Debit and credit notes
- Receipt and payment vouchers
- HSN wise summary
- Blank Cheque for Bank Account details
GST Return Filing Date and Penalty for Online Sellers
GST return filing date and penalty for late filing depends on the type of return form used. It’s already been discussed that online sellers have to file GSTR 1, GSTR 3B, and GSTR 9 returns. Besides, GSTR 9C, GSTR 4, GSTR 5, and GSTR 5A can be filed wherever applicable. Here are their due dates and prescribed late fees or penalty.
| GST Return Form (GSTR) | Due Date | Penalty for Late Filing |
|---|---|---|
|
11th of every month / 13th of every month after quarter’s end, if opted for QRMP |
Rs.50 per day Rs.20 per day for nil.return |
|
|
20th of every month / 22nd or 24th of every month after quarter’s end, if opted for QRMP |
Rs.50 per day Rs.20 per day for nil.return |
|
|
GSTR 9 |
31st December every year |
Rs.50 - Rs.200 per day based on turnover limit |
|
GSTR 9C |
31st December every year |
Rs.200 per day |
|
GSTR 4 |
30th April every year |
Rs.50 per day |
|
GSTR 5 |
13th of every month |
Rs.50 per day Rs.20 per day for nil.return |
|
GSTR 5A |
20th of every month |
Rs.200 per day Rs.100 per day for nil.return |
Section 9 (5): Special Case of GST Return Filing for Online Sellers
Section 9 (5) allows the government to notify certain online sellers who shall be treated differently in the context of GST compliance. In their cases, the e-commerce aggregators or platforms shall be considered as though they’re the original suppliers and shall be made liable to pay GST. This saves the actual online sellers from the burden of GST compliance and return filing. Even GST registration for such online sellers is optional, whereas that for ecommerce aggregators is mandatory. Another added advantage is that the turnover exemption limit for GST registration applies for this category of online sellers. According to the latest regulations, here are the online sellers notified under this category:
- Passenger Transport Service
- Accommodation services
- Housekeeping Services
- Restaurant Services
GST return filing for ecommerce sellers can be a cumbersome process unless guided by a trained tax professional who has thorough knowledge of the same. It requires a decent understanding of the process, the forms to be used and their respective due dates for filing. Besides, the documents are required to be prepared with utmost proficiency. Hence, we advise all online sellers to seek professional help regarding their GST compliance to save themselves from frequent defaults.
FAQs
Q1: What is the difference between e-commerce sellers and aggregators?
Ecommerce aggregators provide a platform to businesses for selling their products online. Ecommerce sellers are the businesses using these platforms to sell their products.
Q2: What are the GST obligations of online sellers?
Online sellers must mandatorily get GST Registration, pay GST, and file timely returns for them. Non-compliance with these obligations may lead to penalties.
Q3: Are all online sellers required to file GST returns?
Yes. Filing GST returns is mandatory for all online sellers. No turnover exemption is applicable to them.
Q4: How to check GST return filing date for online sellers?
The due date to file GST return of online sellers depends on the type of return being filed. A few are filed monthly, whereas others are filed quarterly and annually.
Q5: Is the GST Composition and QRMP Scheme applicable to online sellers?
Yes. Online sellers can opt for GST composition or QRMP scheme provided their turnover falls below the prescribed threshold.