What Are The Penalties For Non-compliance With GST Regulations?

Penalties for non-compliance with GST regulations

Penalties for Late Filing of GST Returns

1. Late Fee for GSTR-3B:

Regular Taxpayers:

?50 per day (?25 CGST + ?25 SGST) up to a maximum of ?5,000.

Nil Return Filers:

?20 per day (?10 CGST + ?10 SGST) up to a maximum of ?5,000.

2. Late Fee for GSTR-9 (Annual Return):

?200 per day (?100 CGST + ?100 SGST) up to a maximum of 0.25% of the taxpayer’s turnover in the state or union territory.

3. Late Fee for GSTR-4 (Composition Scheme):

?200 per day (?100 CGST + ?100 SGST) up to a maximum of ?5,000.

Interest on Late Payment of GST

Interest Rate:

18% per annum on the outstanding tax amount.

In cases of excess claim of input tax credit or excess reduction of output tax, the interest rate is 24% per annum.

Calculation:

Interest is calculated from the day following the due date of payment to the actual date of payment.

Penalties for Other Types of Non-Compliance

1. Non-Registration:

If a person who is liable to be registered under GST fails to register, a penalty of 10% of the tax due or ?10,000, whichever is higher, is levied.

2. Incorrect or Fraudulent Information:

For genuine errors, a penalty of 10% of the tax due or ?10,000, whichever is higher.

For deliberate fraud or suppression of facts, the penalty can be up to 100% of the tax due.

3. Not Issuing Invoice:

A penalty of 100% of the tax due or ?10,000, whichever is higher, is imposed.

4. Failure to Furnish Information:

A penalty up to ?25,000 for failing to furnish information/documents as required under the law.

5. Wrongful Availment of Input Tax Credit (ITC):

A penalty equivalent to the amount of wrongful ITC availed or utilized, along with interest and additional penalties for fraud.

6. Failure to Maintain Records:

A penalty of up to ?25,000 for failing to maintain proper records as mandated by the GST laws.

Penalty for E-Way Bill Non-Compliance

1. Not Carrying E-Way Bill:

A penalty of ?10,000 or the tax sought to be evaded, whichever is higher.

Goods may be detained or seized, and the release is subject to payment of the applicable tax and penalty.

General Penalties

1. General Penalty for Other Offenses:

A general penalty up to ?25,000 for any offense where no specific penalty is prescribed.

Imprisonment for Severe Violations

1. Serious Offenses:

Cases involving substantial tax evasion, fraudulent ITC claims, or repeat offenses can lead to imprisonment, ranging from six months to five years, depending on the amount of tax evaded.