Under the GST regime, GSTR-5 is a specific return that must be filed. The fact that it must be filed by registered ‘non-resident’ taxable persons distinguishes this return from others. It is a monthly return that is obligatorily to be filed by non-resident taxpayers.

GSTR-5 applies to non-resident foreign taxpayers who do not own a business in India but make supplies in the country for a limited time. They must pay tax, interest, fees, and penalties within 20 days of the end of the tax period or within 7 days of the registration validation period, whichever comes first. To avoid any penalties, register your GSTR-5 within 20 days of the end of the tax period. Phoenixtax- GST consultants in Chennai are always ready to assist you.

What is GSTR- 5?

GSTR-5 is a monthly return required by India’s GST regime for all registered “non-resident” taxpayers. This return will document all sales and purchases made by foreign taxpayers who are not residents of the United States. In this form, they must fill out all of the information.

Eligibility

  • A non-resident foreign taxpayer who is registered under GST and makes a supply of OIDAR services (Online information and database access or retrieval services) to a non-taxable person in India must file the GSTR 5 return form.
  • Such a person can obtain a temporary GST registration and file returns for the supplies he made for a specific tax period through the GST portal. The individual should not operate a business in India.

Who is a non-resident taxpayer?

A non-resident taxable person is someone who does not have a business in India but has come to make supply or purchases, or both, for a limited time. The registration of a ‘non-resident’ taxable person is required under Section 24 of the GST law. Even if they do not conduct many business activities in India, every non-resident employee is required to register under the GST regime. The seller’s GSTR-5 information will be reflected in the relevant sections of the buyer’s GSTR-2.

Who can file GSTR-5?

The following are pre-requisites for filing Form GSTR-5:

 1. The taxpayer must be registered as a non-resident taxable person with a valid GSTIN.

 2. The taxpayer must have a current User ID and password.

3. In the event of taxpayers for whom digital signature is required, such as companies, LLPs, and FLLPs, the taxpayer must have a valid and non-expired/non-revoked Digital Signature Certificate (DSC); in all other circumstances, the return can be authenticated using the EVC.

Penalty for not filing GSTR-5

The GST Council stated that for every late payment of tax, an annual tax rate of 18 percent will be levied on the GST tax from the due date until the tax is fully paid.

  • The next month’s return cannot be filed if the NR Taxpayer fails to file GSTR 5. As a result of the late files, it will be subject to severe fines and penalties.
  • If the NR Taxpayer waits too long to file, he or she will be charged interest (18% per year) and a late fee. The amount of outstanding tax to be paid is multiplied by interest, which is estimated by the taxpayer The time period begins the day after you file (the 21st of the month) and ends when you receive payment.
  • The late cost is Rs. 50 per day for regular returns and Rs. 20 per day for NIL returns. A maximum late fee of Rs. 5,000 will be imposed.

GSTR-5 Form structure

The GSTR 5 format contains a large amount of data on a non-resident taxpayer’s inbound and outbound supplies. Let’s take a closer look at the form structure of GSTR-5

GSTIN – Fill in your 15-digit Goods and Services Taxpayer Identification Number (GSTIN), which is derived from your PAN (GSTIN).

Name of the Taxpayer — this field should include the name of your business’s registered tax payer (who is also the authorized signatory under GST law).

Address – The address you gave during registering will be listed in this area.

Period of Return — this is where you specify the time frame for which you are filing the GSTR-5.

Imported Goods

  • You must record the information of all goods (together with their 8-digit HSN numbers) that you have imported into India, as well as all supporting papers (such as the bill of entry).
  • You can amend/update any modifications made to the papers you previously filed under Section 5A of GSTR-5 (such as previous bills of entry). While you’re doing it, as a non-resident foreign taxpayer, you must also provide information of the initial bill of entry that you’ve since changed.

Import of services:

  • You must keep track of all services you imported from other international providers who are also subject to GST.
  • You can amend/modify the details of services that you imported during earlier tax periods under Section 6A of the GSTR-5.

Outward Supplies

  • You must provide information of all sales and outward supplies you made in India during the time covered by this tax return. Remember to include all registered buyers’ information, including their GSTINs, while you’re at it. Also, please keep track of the various GST components, such as CGST, SGST, and IGST, individually.
  • Section 7A of the GSTR-5 allows you to make any changes to the information of sales/outward supplies that you have previously filed.

Details of Credit/Debit Notes

  • In this section, you must enter the details of all credit and debit notes that you have issued in connection with your business activities in India.
  • Using Section 8A of GSTR-5, you can modify/amend the details of credit/debit notes that you have filed previously.

Tax Paid: In this part, you can enter the details of the tax paid for the current tax period under the various GST components, such as CGST, SGST, and IGST. The tax liability for this can be determined using the information you supplied in the previous sections.

Closing Stock of Goods: Enter the data of your closing stock for this tax period here.

Refund Claimed from Cash Ledger:  This section will describe all refunds from the electronic cash ledger that you have received into your bank account (a ledger that needs to be maintained by every taxable person for paying taxes according to the amount they owe as taxes for that period).

Filing GSTR-5can seem hectic for many tax payers. To avoid such havoc, get in touch with Phoenixtax- GST consultant in Chennai today.