The Kerala State Goods and Services Tax (GST) Department has issued directives to governmental departments, bodies including local self-governments to adhere to the proposed changes for modifying the monthly Tax Deducted at Source (TDS) Return GSTR-7 Table-3.
GSTR-7 is a monthly return filed by certain government entities and notified organizations that deduct TDS while making payments to GST-registered suppliers or contractors. Under GST regulations, specific government departments, public sector undertakings, and local authorities are required to deduct TDS at the prescribed rates when making payment for taxable supplies.
The deducted amount is then deposited with the government and the details are reported in GSTR-7.
Take Your SME to the Next Level with IPO Insights – Click here to Register
The GSTR-7 helps to accurately ensure tax compliance while enabling suppliers to claim the deducted tax as credit. GST-registered businesses and/or individuals are required to submit GSTR-7 by the 10th of the month following the one in which they have deducted TDS. Failure to adhere to the requirements may result in penalties, including late fees and interest.
With the new rules being enforced from 1 April, 2025, the Kerala State GST Department has instructed that each invoice be declared separately in Table-3 of GSTR-7. Officials responsible for deducting TDS must ensure they possess the relevant invoices when making payments to suppliers and contractors registered under GST.
Read More: Mandatory Sequential Filing of GSTR-7 Returns: GSTN issues Advisory
In the event that the supplier or contractor is part of the GST compensation scheme, a bill of supply must be provided by them in place of an invoice. Additionally, in cases of advance payments, a receipt voucher is to be mandatory submitted.
As per GST regulations, suppliers and contractors must provide all necessary documents at the time of supply, while government department and local self-government officials are responsible for collecting them. The SGST Department has warned that failure to file GSTR-7 on time could lead to unwanted occurrences including penalties and inadvertent processes.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
