GSTR 6

Good and Service Tax (GST) was introduced in India in 2017 to make tax filing simpler and easier for business owners and individuals. For businesses, one particular component of GST tax filing is GSTR 6. It is a monthly submission required by Input Service Distributors (ISDs). 

In this article, we will cover GSTR 6 meaning and the GSTR 6 filing process in detail. 

What is GSTR 6?

GSTR 6 is a monthly tax return that the Input Service Distributor (ISD) registered under GST has to file on a monthly basis. This is needed for the distribution of Input Tax Credit (ITC) among the recipients based on the invoices issued. 

GSTR 6 Form helps businesses to claim credit on the already paid GST and reduces their overall tax burden. This form includes details about the ITC received and distributed by the ISD.  This form is submitted after verifying and possibly amending the details provided in GSTR 6A.

You must be wondering what GSTR 6A is and how it is related to GSTR 6. Let’s clarify that first before diving more into the GSTR 6 return filing process. 

GSTR 6A is an auto-generated form that has the details of inward supplies received by an ISD based on the information provided by its suppliers in their GSTR 1 returns. This form is read-only and serves as a draft, helping ISDs review the data before filing their GSTR 6 return.

It is important to note that GSTR 6A is not a form that needs to be filed but rather a preliminary report for reference and verification purposes.

GSTR 6A Form is generated when suppliers upload B2B transaction details in their GSTR 1 forms. 

If the supplier submits their return before the ISD submits GSTR 6, then the supplier's B2B details are auto-populated in the current tax period's GSTR 6A. However, if the supplier submits their return after the ISD has submitted GSTR 6, the information gets reflected in the next tax period's GSTR 6A.

We hope this clears your doubts. Now, let’s get back to the GSTR 6 filing process. 

Importance of GSTR 6

As mentioned earlier, GSTR 6 is the monthly return that ISDs are required to file. 

• ITC Distribution: GSTR 6 facilitates the distribution of ITC among the units of an ISD, ensuring that the credit is accurately allocated based on the invoices received
• Compliance Obligations: Filing GSTR-6 is mandatory for registered ISDs, regardless of whether there are transactions to report in a specific period.
   

Who Is Required To File GSTR 6?

Input Service Distributors (ISDs): Any entity that receives input services centrally and distributes the ITC to its units/locations is required to file GSTR 6. These include i) Businesses with Multiple Units ii) Head Offices iii) Entities with Cost Sharing Arrangements.

Due Date For Filing GSTR 6

GSTR 6 must be filed monthly by the 13th of the month following the relevant tax period. This regular filing is to make sure that the ITC distribution is accurately reported and updated.

What Is The Format Of GSTR 6?

GSTR 6 has a total of 11 sections which will cover to here to help you with the GSTR 6 return filing process:

GSTIN

The GSTIN (Goods and Services Tax Identification Number) of the dealer for whom the return is being filed.

Name of the Registered Person

The name of the taxpayer, which is auto-filled based on the GSTIN.

Input Tax Credit Received for Distribution

This section includes invoice-wise details of all inputs received, which are distributed as ITC.

Total ITC/Eligible ITC/Ineligible ITC to be Distributed for the Tax Period

This part segregates the total ITC into eligible and ineligible categories.

Distribution of Input Tax Credit Reported in Table 4

This part captures the entire distribution of ITC by the ISD.

Amendments in Information Furnished in Earlier Returns in Table No. 3

This section allows corrections to any mistakes in invoice details provided in previous returns.

Input Tax Credit Mismatches and Reclaims to be Distributed in the Tax Period

Here any changes to the total ITC due to mismatches or reclaimed ITC on rectification is addressed. 

Distribution of Input Tax Credit Reported in Table No. 6 and 7 (plus/minus)

This section is about adjusting the amount of credit distributed based on previous entries.

Redistribution of ITC Distributed to a Wrong Recipient (plus/minus)

Here, the ITC that was previously distributed to the wrong recipient is adjusted and rectified. 

Details of Inward Supplies Received

This section includes all the details of inward supplies received for which the ITC is being distributed.

Late Fees and Refunds

Any late fees applicable and refunds claimed are shown here. 

Requirements For GSTR 6 Filing

The following details are needed for GSTR 6 filing. 

• GST Identification Number
• Input Tax Credit (ITC) Distribution Details
• ISD Invoice Details
• Any updates or corrections to the details of the ITC distribution
• Authorized Signatory

In addition to this, it is also needed that the rules and provisions related to Input Service Distribution under the GST regulations are followed. This ensures compliance with the regulatory requirements for ITC distribution.
 

How to File GSTR 6?

Let’s have a look at the GSTR 6 filing process. 

1. Login and Navigation

Access the GST portal (www.gst.gov.in) and log in using valid credentials. After that go to the 'Services > Returns > Returns Dashboard' section and select the appropriate financial year and return filing period for GSTR 6.

2. Preparing GSTR 6

After selecting GSTR 6, click the 'PREPARE ONLINE' button and fill in the required details directly on the portal. This includes:

• Information on input tax credit received for distribution
• Amendments of information furnished in earlier returns
• Other relevant data.

3. Filing and Submitting GSTR 6

After thoroughly reviewing and entering all necessary details, you can file the return. This involves:

• Selecting the 'PROCEED TO FILE' button
• Reviewing the consolidated summary
• Completing the submission with a digital signature (DSC) or EVC (Electronic Verification Code).

4. Late Fee and Final Steps

If applicable, you will be able to see the late fee details in this part for which you have to make a payment. Once all details are verified and confirmed, you can submit the applicable form.  This will change the status of Form GSTR-6 to 'Filed’.

Late Fees And Penalty For Delayed Filing Of GSTR 6

The Goods and Services Tax (GST) Act imposes penalties for any delay in GSTR 6 return filing. Late fees for non-compliance in GSTR 6 is Rs. 50 per day. Whether the GSTR 6 filing is nill of has taxable transaction, not filing it on the due date attracts penalties. 

If not paid, these charges are automatically carried over to your next GST return. This means you would not be able to file the coming GSTR 6 returns if there are any dues on your end. 

Neglecting to file your GST returns for an extended period, such as six months, can also lead to severe consequences, including the cancellation of your GST registration. This affects your business and the ability to claim Input Tax Credit.

Conclusion

GSTR 6 return is important for Input Service Distributors (ISDs) under the GST regime.  The due date falls on the 13th of every month. It is crucial to file the GSTR 6 Form by the due date to avoid penalties and interest charges and to ensure that you can claim the input tax credit.