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Online GST Payment Procedure Stepwise Details

Online GST Payment Procedure Stepwise Details

Online GST Payment Procedure

Online GST Payment Procedure : The process of payment of taxes has also changed under GST and it is now mandatory for businesses making payment for more than Rs 10,000 to do it electronically. There are three different ledgers which need to be maintained for payment of tax.

Under GST Law some taxes and duties may still remain outside the purview of GST and will will continue to be collected in the manner prescribed under existing accounting procedures/rules/manuals, etc. This means that two types of challans (one for GST and other for non-GST) will be used and accounted for.

Online GST Payment Procedure

OBJECTIVE OF THE REPORT:

i. Need for a uniform system of banking arrangements for collection, remittance and reporting of GST to both Central and State Governments;

ii. Highlight key issues in the Existing system of payment;

iii. accounting and bank reconciliation of taxes derived from basic data of payments made by taxpayers to banks, with the required classification of heads of accounts indicated on the Challan;

iv. Designing the format of a new Challan for use by the taxpayers paying GST;

v. Developing a detailed accounting procedure common to both Central and State Governments.

Online GST Payment Procedure

FEATURES OF THE PROPOSED PAYMENT PROCESS:

No manually prepared challan i.e. E-challan for all modes of payment. Provision of anytime, anywhere mode of payment of tax. Paperless transaction. Speedy accounting and reporting. E-reconciliation of all receipts. Simplified procedure for banks. Convenience of making payment online. Faster remittance of tax revenue to the Government Account.

Online GST Payment Procedure

MODES OF PAYMENT:

The modes of payment of GST prescribed in the report are as follows: i. Payment by taxpayers through Internet Banking through authorized banks and through credit card/debit card; ii. Over the Counter payment (OTC) through authorized banks; iii. Payment through NEFT/RTGS from any bank (including other than authorized banks). The mode of payment prescribed in point (2) above will be available for payments up to Rs. 10,000/- per challan only.

Online GST Payment Procedure

STAKEHOLDERS PLAYING KEY ROLE IN EACH MODE OF PAYMENT:  

1. Internet Banking/ Credit Card/ Debit Card GSTN (Goods and Service Tax Network); e- FPBs (Electronic Focal Point Branches) of authorized banks; e-Kuber of RBI; Central Accounts Section (CAS) of RBI, Nagpur; e-PAOs (Electronic Pay and account Offices) / e-Treasuries of State Governments; CCA, CBEC (Principal Chief Controller of Accounts) / Accountant General of the States; Tax authorities of Centre and States.  

2. Over The Counter Payment (OTC) GSTN; Branches of Authorized Banks; e-FPBs of Authorized banks; e-Kuber of RBI; e- PAOs of Centre / e-Treasuries of State Governments; CCA, CBEC / Accountant General of the States; Tax authorities of Centre and States.  

3. NEFT/RTGS Branch of remitter bank; RBI performing functions akin to authorized banks. Hence, it is desirable that under the GST regime, all taxpayers should gradually move to internet payment over an indicative time frame

Online GST Payment Procedure

Payment process under GST

  • Electronic tax liability ledger (GST PMT1)

Each registered taxpayer under GST has to maintain an electronic tax liability ledger. The electronic tax liability ledger would show the tax due from a regular tax return, and the interest, penalty, demand notice under each of the major heads. Payments can be made using the input tax credit (ITC) available in the electronic credit ledger.

  1. Electronic cash ledger (GST PMT5)

Payments would be made under 3 major heads named CGST, SGST, IGST and it is further divided into the different minor heads like tax, interest, penalty, fees and others. The electronic cash ledger would be debited for the total value in case of payments being made from any or combination of the above major/minor head.

The electronic cash ledger will also display the balance available under the various combination of the major-minor head and any refunds received by the taxpayer would reflect in this ledger.

  1.   Electronic credit ledger (GST PMT2)

 All the taxes paid on the inputs would be recorded in the electronic credit ledger. The input tax credit in each of the cases mentioned below, shall also be transferred to the electronic credit ledger: 

  • ITC available to the branch for the amount of credit transferred by ISD in accordance with rules laid under Model GST law.
  • ITC allowed on input held in stock and the semi-finished or finished goods would be credited to electronic credit ledger if the taxpayer applies for registration within 30 days of becoming liable to pay tax.
  • ITC available on the input held in stock and semi-finished or finished goods by a taxpayer in the composition scheme converting to a normal taxpayer shall be transferred to electronic credit ledger.
  • ITC available due to the taxes paid under the reverse charge mechanism shall also be transferred to the electronic credit ledger.
  • ITC available on goods/services used for the business and other purposes shall only be allowed to the extent applicable for business purposes.

All the payments under GST have to be made by either using the input tax credit available in the electronic credit ledger or through the electronic cash ledger.

Online GST Payment Procedure

The table below shows the process of tax payment under the major heads of IGST, CGST, SGST:

Online GST Payment Procedure

*Payment of less than Rs 10,000  through cash and cheque can be made at the authorized banks.

Online GST Payment Procedure

Utilizing ITC for the fulfillment of Tax liability:

IGST: After the IGST input tax credit is used for payment of IGST then the remaining ITC can be used to pay tax liability under CGST and SGST.

CGST: The CGST input tax credit cannot be used to pay the SGST liability but can be used to pay the liability under CGST.

SGST: The SGST input tax credit cannot be used to pay the CGST liability but can be used to pay the liability under CGST.

Taxpayer will make the payment using the USER ID and Password provided by the bank to enter into the secured e- banking area of his bank. He will select an account for debiting the total tax amount and authorize the payment. While making the payment, the bank will display the breakup of total amount payable into CGST, IGST, Additional Tax and SGST and seek confirmation from the user. No change in the break up as well as the total amount would be allowed on the Bank’s portal. In case the user wants to change the break up or the total amount, he should abort the transaction and go back to GSTN portal from the bank’s portal and reinitiate the process.

After the successful completion of a transaction, e-FPB of the concerned bank will create a unique Challan Identification Number (CIN) against the CPIN. This will be a unique 17-digit number containing 14-digit CPIN generated by GSTN for a particular challan and unique 3-digit Bank code (MICR based which will be communicated by RBI to GSTN). The incorporation of the date of payment in the CIN may be examined from the IT’s perspective. This CIN, as a combination of CPIN and Bank Code, will be reported by the banks along with its own Unique Bank reference number (BRN). Such CIN is an indicator of successful transaction and will be used as a key field for accounting, reconciliation etc. by taxpayers, accounting authorities and tax authorities. After every successful e-payment transaction, there will be an instantaneous reverse flow of information through an electronic data string from the collecting bank to the GSTN containing the following details:

a) CIN;

b) GSTIN;

c) Bank Reference number (BRN);

[Since there could be maximum of four credits against one debit, banking practice may be ascertained by GSTN. If such transactions (i.e. four credits against one debit require multiple BRNs i.e. one for each credit entry), all BRNs should be reported.]

 d) Challan amount;

 e) Date of Payment;

 f) Time of Payment

 “Transaction not completed” in GST online payment – solutions

Online GST Payment Procedure

If the transaction cycle is not completed because of failure of credential verification, there would be no response from the bank to portal informing about the same. If a response (positive or negative) is not received by GSTN within the stipulated period (few minutes), there would be a feature in GSTN to re-ping the bank system and seek a response against CPIN. There may be a scenario in which the internet banking transaction is successful, but the connection drops before the control comes back to GSTN portal, and the re-ping facility will help in finding the status of such transactions.

 Upon receipt of confirmation from the bank regarding successful completion of the transaction, GSTN will inform the relevant tax authorities about payment of taxes. A copy of the paid challan (downloadable/printable) with auto-populated CIN, date and time of payment and a statement confirming receipt of the amount by the bank will be provided to the taxpayer by GSTN.

 Thereafter the tax paid challan (CIN) will be credited to the tax ledger account of the taxpayer. It was discussed and agreed by the Committee that there would be 20 ledger accounts (one for each Major heads i.e. CGST, IGST, Additional Tax & SGST and 4 Minor heads for each Major Head i.e. Interest, Penalty, Fees & Others).

Online GST Payment Procedure

Online GST Payment Procedure, Tax payment under GST

Now the GST will soon be launched, an essential point to note is the process of tax payment. First, it is essential to understand if the individual is qualified for GST tax or not. There are various conditions which the taxpayer can check to understand the criteria for the qualification and the procedures for payment under GST.

Deposits can be made in the Electronic Cash Ledger for making payments towards tax, interest, penalty, fee or any other amount under any of the GST Laws. Below here is the short introduction procedure for payment under GST in India.

Mode of Payment under GST
  • Debit card or Credit card
  • NEFT or RTGS from any bank
  • Over the Counter

Payment under GST – Debit card or Credit card

Step 1:  Access GSTN for generation of the Challan.

Step 2:  Fill the draft challan.

Step 3:  Select the mode of payment.

Step 4:  It will direct you to the website of the selected bank.

Step 5: Make the payment through the bank will display the breakup of the total amount payable.

Step 6: A unique CIN (Challan Identification Number) against the CPIN (Common Portal Identification Number) will be created which is an indicator of a successful transaction.

Step 7: If the transaction is not completed because of failure of credential verification, you can refresh the bank system and seek a response against CPIN.

Step 8: Upon receipt of completion of the transaction, GSTN will inform the relevant tax authorities about payment. A copy of the paid challan and a statement confirming receipt of the payment will be provided to you by GSTN.

Step 9: Thereafter the tax paid challan CIN will be credited to your tax ledger account.

Online GST Payment Procedure

Payment under GST – NEFT or RTGS

Online GST Payment Procedure

Online GST Payment Procedure

Sl No.TopicDOWNLOAD LINK
1.Schedule of GST rates for services CHECK HERE
2.GST Tariff Code in Uttar Pradesh CHECK HERE
3.Complete Details on GST CHECK HERE

Check here for more GST Offline Utilities – Click

Check here to know more on GST Delivery Challan :

SL NO. TOPICSLINK
1.GST Delivery Challan Excel format 1CHECK HERE
2.GST Delivery Challan Excel format 2CHECK HERE
3.GST Delivery Challan PDF formatCHECK HERE

For more on GST and Online GST Payment Procedure log onto www.cakart.in

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