Understanding Form GSTR-3B

Goods and Services Tax (GST), biggest

tax reform since independence is now
entering into return filing compliance
phase. There is an anxiety over when
and how GST to be paid and returns to
be filed with regulatory authorities.

As an endeavor to simplify transition

and ease out the difficulties faced by
business, we are representing our alert
on next course of actions to be taken
this month.

1. Return filing under GST

In GST regime, taxpayers are required to file Returns depending on the activities they
undertake. There are separate Returns and timelines for taxable person opting for
composite scheme, non-resident taxpayer, input service distributor, tax deductor and e-
commerce operator.

Every registered taxpayer other than above are required to file at least 3 monthly tax
Returns and one annual Return making total count of minimum 37 Returns a year.
2. Timelines for return filing

It has been decided by the Government that, for the first two months of GST
implementation, tax would be payable based on a simple return (Form GSTR-3B)
containing summary of outward and inward supplies which will be submitted before the
20th of the succeeding month.

However, the invoice-wise details in registered GSTR – 1 would have to be filed for July
and August, 2017 as per the timelines given below.

Month GSTR – 3B GSTR – 1 GSTR – 2 (auto)

July 2017 20th Aug 1st – 5th Sept 6th – 10th Sept

Aug 2017 20th Sept 16th – 20th Sept 21st – 25th Sept

Sept, 2017 N.A Up to 10th Oct Up to 15th Oct

From September onwards, every taxpayer has to strictly follow the registered
provisions of filing return on 10th, 15th and 20th of next month i.e. October. Also, there
will be no late fee or penalty levied for the initial two months.

But, for the first two months i.e. July and August every taxpayer needs to file his return
in GSTR-3B on self-assessment basis by 20th Aug and 20th Sept respectively. It shall
be containing a summary of inward and outward supplies.

Currently, GSTR 3B doesn’t provide for carry-forward of eligible credits available under
the pre-GST regime (i.e. excise duty, service tax and value-added tax). Hence,
registered taxpayers will not be able to adjust taxes paid against their output liability
during the interim period which may result in a cash flow issue.
3. How to fill-up Form GSTR-3B:
It has been decided by the Government that, for the first two months of GST implementation, tax would
be payable based on a simple return (Form GSTR-3B) containing summary of outward and inward
supplies which will be submitted before the 20th of the succeeding month. However, the invoice-wise
details in registered GSTR – 1 would have to be filed for July and August, 2017 as per the timelines
given below.

GSTIN of the Taxpayer

GSTIN: Enter 15 digit GSTIN of the registered taxpayer for which Form 3B is to be filed

Legal name: The registered taxpayer’s name would automatically be displayed once GSTIN is entered

3.1. Details of outward supplies and inward supplies

• Outward Supplies: Outward supplies are goods sold / supplied or services provided within India
(both inter-state and intra-state)

• Inward supplies liable to reverse charge: There are certain notified goods and services for which
the recipient needs to pay the tax instead of supplier

• Value of Taxable Supplies = Value of invoices + value of Debit Notes – value of credit notes +
value of advances received for which invoices have not been issued in the same month – value of
advances adjusted against invoices

a) Outward taxable supplies (other than zero rated, nil rated and exempted) includes:
I. Inter-state and intra-state (within state) supplies
II. Integrated GST (IGST) on inter-state supplies
III. Central GST (CGST) and State GST (SGST) / Union Territory GST (UTGST) being equally
divided in case of intra-state supplies
IV. Cess, if any

b) Outward taxable supplies (zero rated) - It includes:

I. Taxable value of supplies outside India
II. Taxable value of supplies to notified SEZ within India
III. IGST on the aforesaid supplies (here CGST and SGST / UTGST should be left blank)

c) Other outward supplies (Nil rated, exempted) – It includes:

I. Supplies for which notified rate of tax is Nil
II. Supplies which are specifically exempted as per GST law
III. All tax columns should be kept as Nil

d) Inward supplies (liable to reverse charge) - It includes:

I. Taxable value of inward supplies (inputs or input services) where onus of payment of tax
falls on the receiver
II. Amount of equal division of tax between CGST and SGST / UGST in case of intra-state
supplies

e) Non-GST outward supplies - It includes:

I. Value of sales of goods which do not fall under the ambit of GST
3.2. Details of inter-State supplies made to unregistered persons,
composition taxable persons and UIN holders:

All details in this table pertain to inter-state supply related to taxable supplies as
provided in table 3.1 above

a) Supplies made to Unregistered Persons: It includes:

• Inter-state supplies made to unregistered taxpayers

• State-wise (or UT-wise) details of total taxable value and amount of IGST

b) Supplies made to Composition Taxable Persons: It includes:

• State-wise (or UT-wise) detail of taxable supply made to registered taxable

person opting for Composition Scheme
• Amount of IGST on such supply

c) Supplies made to UIN holders - It includes:

• State-wise (or UT-wise) details of supplies made to UIN holders

• Amount of IGST, if any on such supply
4. Eligible ITC

Inward Supply: Inward supply means receipt of goods or services or both with or without
consideration. This section of the form captures details related to inputs or input services.

a) ITC Available (whether in full or part):

I. Import of goods: IGST paid on goods imported and used only for business purposes
II. Import of services: IGST paid on import of services and used only for business purposes
III. Inward supplies liable to reverse charge (other than 1 & 2 above): If any inward supply is
made which is liable to reverse charge, i.e. where the onus of payment of tax falls on the
receiver, tax paid will be provided as ITC in the subsequent month
IV. Inward supplies from ISD (‘Input Service Distributor’): In case a business has multiple
units and is supplying goods or services from all such units, the input service distributor will
allot the relevant ITC to each such unit. The details of allocated input tax need to be
mentioned here
V. All other ITC: Any other ITC as may be applicable and not mentioned above.
b) ITC reversed (as per rules 42 & 43 of CGST Rules):

• Rules 42 pertains to the manner of determination of ITC in respect of inputs or input

services which are partly used for the purposes of business and partly for other
purposes, or partly used for effecting taxable supplies including zero rated supplies
and partly for effecting exempt supplies. These rules have prescribed the formula for
determination of input tax credit in such cases.
• Rule 43 is applicable in case of capital goods.
c) Net ITC Available (A) - (B): This is net ITC available for the tax period which is
calculated as the difference between (A) and (B) calculated above

d) Ineligible ITC:
ITC is not available against the following:

• Motor vehicles and conveyances except where used for supply of specified services
• Services such as food and beverages, outdoor catering, beauty treatment, cosmetic
and plastic surgery except where used for supply of specified services
• Membership of a club, health and fitness center
• Rent-a-cab services
• Life insurance and health insurance except where it is obligatory under any law or
supplied as part of a taxable composite or mixed supply
• Travel benefits extended to employees on vacation such as leave or home travel
concession
• Works contract services when supplied for construction of an immovable property
(other than plant and machinery)
• Goods and services used for construction of an immovable property on own account
• Supplies on which tax is paid under composition scheme
• Goods and services received by non-resident person except imports
• Goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples
• Goods and services used for personal consumption
• Any other credit that may be ineligible
5. Values of exempt, nil-rated and non-GST inward supplies:

From a supplier under composition scheme, exempt and nil rated supply: It shall
include inward supplies both inter-state and intra-state:

I. Value of inward supply from a supplier to whom the composition scheme is

applicable
II. Value of inward supply which is exempt from tax
III. Value of inward supply where the tax payable is NIL

Non-GST supply: This includes value of goods purchased or services received which
do not fall under the ambit of GST (e.g. alcohol for human consumption and petroleum
products).
6. Payment of tax: Here the details of net tax payable after deducting
ITC
6.1. Payment of Tax

Net tax payable shall be calculated after reducing the eligible ITC from the tax payable on outward
supply.
I. Tax payable: Here the total tax payable should be mentioned. It should match with the
details of tax provided in table 3.1 above.
II. Integrated Tax: The break-up of IGST paid out of ITC available
III. Central Tax: The break-up of CGST paid out of ITC available
IV. State /UT Tax: The break-up of SGST / UT GST paid out of ITC available
V. Cess: Cess paid through ITC, if any
VI. Tax paid TDS / TCS: Any tax deducted by any department of the Central or State
Government, local authorities, Government agencies or E-commerce operator (TDS / TCS
provisions have been deferred by the Government vide Press Release dated 26 June
2017).

6.2. TDS/TCS Credit

This column captures the details of TDS/TCS credit available on applicable supplies
For any GST related assistance, please write to us at:
[email protected]

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Disclaimer
This publication contains information of general nature. The information is only for general
guidance and is not meant to be a substitute for professional advice in any manner. In case
the reader requires any specific inputs / suggestions / advice from our end, please contact us
separately.