On Thursday, the government submitted the form for auditor's report and reconciliation statement that must be submitted annually by taxpayers with a turnover of more than Rs 2 crore. In addition, the government reported on 1 October as the implementation date for the introduction of tax levies at the source (TCS) and tax withheld at the source (TDS). Although TDS applies to notified bodies that provide goods and services worth Rs 2.5 lakh, TCS must be collected by e-commerce companies before payments are made to sellers operating on their portal.
The rate for both is 1%. As a result of the increased compliance burden, the GST Council had suspended provisions of TCS / TDS, which are considered as important means of circumvention, because the new tax system was introduced in July last year. Also, another provision of reverse charge mechanism, including the obligation to levy taxes, falls on registered taxpayers who purchase deliveries from non-registered dealers, also suspended since July 2017. Shubham Mittal, DGM, Taxmann, said that taxpayers who are required to be audited by a chartered account would electronically provide the annual return in GSTR-9, reconciliation statement in GSTR-9C and copy of audited annual accounts.
The GST portal has not yet rolled out the functionality to deliver these two forms. "The e-commerce companies for TCS and various PSUs / public companies for TDS should quickly adapt their ERP systems to comply with these provisions from October 1. With an approving audit report, the industry should really nod up, especially given the short time frame, "said Abhishek Jain, tax partner at EY.