Delhi Value Added Tax - Part 5 - Payment of Taxes and Submission of Returns
November, 01st 2010
This part deals with procedures for payment of tax and submission of returns.
When to Pay Your Taxes
You calculate your net tax after subtracting your tax credits from the output tax payable on your turnover of sales. Any positive amount of net tax for a particular tax period must be paid to the DVAT authorities within 28 days from the end of that particular period.
How and Where to Pay Your Taxes
You may pay the tax, together with any interest, penalty or any other amount due from you, in rupees in any of the following ways:
(a) cash; (b) crossed cheque; or (c) bank draft made in favour of "Commissioner Delhi Value Added Tax", and drawn on an authorised bank
Such amounts may be paid in any of the above-mentioned ways accompanied by a tax deposit challan (Form DVAT-20) at:
(a) a Delhi branch of the Reserve Bank of India;
(b) a Delhi branch of an authorized Bank;
(c) any other place notified by the Commissioner.
We may provide separate procedures for method of payment in electronic form.
What if You Delay in Making the Payments
If there is a delay in -
The ordinary course of paying tax for any particular tax period; or
Paying additional amounts of tax that have been assessed by the DVAT authorities in respect of any particular tax period;
the liability to pay interest and penalty commences on the day following the last day of filing for that period.
How is Interest Calculated?
Interest is computed from the date of the default until the outstanding amount is paid. It is computed on a daily basis, applying the prescribed annual interest rate.
For the period ending 31st March, Gauri files her return on 28th April. She has a positive net tax liability of Rs 1000, which she pays on the 10th of July. Let us assume that the notified interest rate is 16%.
Gauri will have to pay interest for the period 29th April to 10th July (i.e. 73 days).
The amount of interest is calculated as :
1000*73*16% ___________ 365
Therefore, the amount payable as interest should be = Rs 32.
In addition, you will also be liable to a penalty at the rate of 1% of deficit tax per week or Rs 100 per week, whichever is higher.
When Should You File Your Return
You are required to file a DVAT Return in Form DVAT-16 within 28 days from the end of your tax period, along with proof of payment, in Form DVAT-20, of the amount due. Even if you have no refund or tax payable, you should still file your returns.
If you discover a mistake or error in a return filed by you, which has resulted in payment of less tax than the amount due, you should file a revised return immediately. While a revised return can be filed within four years of filing the original return, you should be aware that any delay will make you liable to payment of interest and penalty. The Revised Return should be in Form DVAT-16 along with explanatory notes specifying the mistake or errors and must be accompanied by proof of payment of the tax deficiency.
If you are a dealer and have opted for composition scheme and have discovered some mistake or error in your return, then you would be required to furnish a Revised Return in Form DVAT-17.
If, as a result of the mistake, excess tax was paid by you, then you can lodge an objection.
When to Submit Your CST Returns
Given that all dealers registered for CST will also be registered for DVAT, the timing of CST returns has been harmonized with that for DVAT returns.
You must report your CST liability either monthly or quarterly according to the tax period adopted for DVAT purposes. The determination of the periodicity of CST reporting requirement will be on the same basis that has been adopted for submitting DVAT returns.
The monthly or quarterly reporting of CST will continue to be done on the CST returns. CST amounts and turnovers will also be reported on DVAT returns for information purposes to allow the offsetting of CST liability by any excess DVAT credits.
"A" is a registered DVAT and CST dealer, who is required to submit DVAT returns on a monthly (or quarterly) basis. He submits DVAT and CST returns for a particular tax period (whether it be monthly or quarterly) and he also reports his CST liability on the DVAT return for the same period.
Annual Reconciliation Statement
In addition to the periodic monthly or quarterly reporting of CST, an Annual Reconciliation Statement must also be submitted. The CST Annual Reconciliation Statement is to be submitted within nine months of the end of the relevant year (i.e. by 31st December).
All statutory declaration forms, such as Form C, Form E-I and Form E-II, etc., on which concessional rate of CST was claimed, will have to be submitted along with the annual statement, in support of such concessional rate.
The annual reconciliation statement seeks to consolidate and reconcile all the details in relation to the CST that were reported during the course of the year.
Where declaration forms were expected, but subsequently were not received, any concessions or exemptions from CST that claimed during the year would be reversed in the Annual Reconciliation Statement. If you either fail to submit Annual Reconciliation Statement or do not submit required statutory forms for inter-state transactions or exports out of India to the department, all such transactions will be treated as local sales and taxable as such. You will be assessed for the additional tax due or excess tax credits claimed, and may also be liable for penalties for filling of wrong declaration and tax returns.
ABC, a CST registered dealer has been reporting his CST liability on a monthly or quarterly basis, as the case may be. After he has submitted his last monthly or quarterly return, for the period ending 31st March, he will submit his Annual Reconciliation Statement by 31st December.
At the time of submitting his Annual Reconciliation Statement, ABC does not have Form C that he was expecting for a number of transactions, on which he had reported concessional CST liabilities in his returns during the course of the year. While preparing his Annual Reconciliation Statement, ABC will indicate the turnover on which he had reported CST liabilities at a concessional rate, but for which he does not have Form C, and determine and pay the additional CST without the benefit of the concessional rate