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India Extends Tax Compliance Deadlines to Offset COVID-19 Impact

The rapidly escalating novel Coronavirus has claimed over 15,000 victims and infected close to 400,000 people across 132 countries. India saw its first positive case in the first week of March, and in less than four weeks, this number has crossed 500. Vowing not to follow in the lines of the heavily infected countries, India has imposed a 21-day lockdown period starting March 25, 2020. While this is an excellent move and should hopefully flatten the curve for India, it does raise concerns among taxpayers who are expected to file their tax returns – March being the tax month.

The lockdown will prove to be particularly tricky for tax practitioners, chartered accountants and company secretaries as organizations have started to work from home and these professionals have minimal access to data before impending deadlines.

Realizing this concern as well as others around tax compliance, Union Finance Minister, Nirmala Sitaraman announced the implementation of various statutory and regulatory compliance relief measures to help concerned taxpayers, especially MSMEs. This article outlines the highlights of the press conference along with a detailed timeline of all announcements.

Highlights from the press conference

Deadlines extended

The deadline for filing returns of the goods and services tax for March, April, and May this year has been extended till June 30, 2020. Organizations with an aggregate annual turnover of less than Rs. 5 Crore can file GSTR-3B due in March, April, and May 2020 by the last week of June 2020 without attracting any penalties.

Taxpayers with an annual turnover above Rs. 5 crores are required to file their returns due in March, April, and May 2020 by the last week of June 2020. However, this will attract interest, but the same will be charged at a reduced rate of 9% per annum from 15 days after the due date instead of the current 18%.

Additionally, if the returns are filed before June 30, 2020, taxpayers will be no late fees or penalties.

Taxpayers who would like to opt for the GST composition scheme can do so by the last week of June 2020. The last date for making tax payments for Q1 2020 and the last date for filing of return for FY 2019 20 by the composition dealers was extended till the last week of June 2020.

The government has also extended the last date for linking the PAN card with Aadhaar from March 31 to June 30. Additionally, the last date for filing the income tax returns for FY 2018-19 has been extended from March 31 to June 30, 2020.

Newly incorporated organizations that are required to declare the commencement of business within six months of operations have been given an additional six months to file their declarations.

The due date for issue of notice, notification, approval order, sanction order, filing an appeal, furnishing applications, reports, any other documents and the time limit for any compliance under the Customs Act and other allied Laws where the time limit is expiring between March 20, 2020, to June 29, 2020, shall be extended to June 30, 2020.

Additionally, clearance under Customs will be available on a 24×7 basis until June 30, 2020.

Finally, the due date for issue of notice, notification, approval order, sanction order, filing an appeal, furnishing returns, statements, applications, reports or any other documents and the time limit for any compliance under the GST laws where it is expiring between March 20, 2020, and June 29, 2020, has been extended to June 30, 2020.


Thresholds expanded

The default limit for filing insolvency and bankruptcy code has been raised from Rs. 1 lakh to Rs. 1 crore.

An economic bailout package will be announced soon and is likely to focus on procedural measures on the SME tax front. While this is a welcome move, industries are still hoping to be granted some tax relief as the lockdown is causing economic damage on a massive scale.

Summary

1. Extension In Filing GST Returns

GSTR 3B Current Due Date Extended Due Date
March 2020 20/04/2020 30/06/2020
April 2020 20/05/2020
May 2020 20/06/2020

All Due Dates are in Staggered Manner

GSTR 9 and 9C Current Due Date Extended Due Date
FY 2018-19 31/03/2020 30/06/2020

2. Interest, Penalties and Late Fees Waiver

Particulars Below INR 5 Crores Turnover Above INR 5 Crores Turnover
Interest Waived For any delayed payment made between March 20, 2020, and June 30, 2020, there is a reduced rate of interest 9% per annum, currently which is 18% per annum
Penalty Waived Waived
Late Fee Waived Waived

3. Relaxation for Composition Dealers

Date to opt for composition scheme, the last date for making tax payments for Q1 2020, and the last date for filing of return for FY 2019 20 by the composition dealers extended till the last week of June 2020.

4. Extension of Time limit Other Compliances

Due date for issue of notice, notification, approval order, sanction order, filing of an appeal, furnishing of return, statements, applications, reports, any other documents, the time limit for any compliance under the GST laws where the time limit is expiring between 20 03 2020 to 29 06 2020 shall be extended to 30 06 2020.

5. Extension for Payment under Sabka Vishwas Scheme

Payment date under Sabka Vishwas Scheme has been extended to June 30, 2020. If payment is done before end of June, taxpayers will be charged no interest for the said period.

https://www.avalara.com/in/en/blog/2020/03/india-extends-tax-compliance-deadlines-to-offset-covid-19-impact.html

To understand how Avalara can help you with GST compliance, visit www.avalara.com

 

 

 

 

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