1-Provision of GST-TDS 

GST-TDS under CGST Act ,2017 is a separate concept from TDS under the Income Tax Act,1961. In other words, separate TDS deduction,deposits & separate filling of returns and separate is  required to follow by  the deductor. Section 51 of the CGST Act, 2017 lays down provisions in respect of TDS Payments under GST.

Initially, as per Notification No. 33/2017 – Central Tax dated 15th September, 2017, the government decided that the provisions of section 51(1) would come into effect from September 18th, 2017.

However, in suppression to this Notification, Notification No. 50/2018 – Central Tax was released by the government on 13th September, 2018. According to this notification, the government decided that the provisions of TDS under GST would come into effect from October 1st, 2018.


















TDS provisions under GST Acts shall come into effect from 01/10/2018. From 01/10/2018, when procuring goods or services of value exceeding Rs.2.50 lakhs, TDS authorities shall be required to deduct tax at source from the amount payable to the supplier.  If the supplier makes intra-state supply (i.e. charges tax under CGST and SGST in the invoice),Ø TDS shall be made @1% under CGST and 1% under SGST, totaling to 2%. But if the supplier makes inter-state supply (i.e. charges tax under IGST in the invoice), TDS shall be made @2% under IGST.

2-Authorities required to deduct GST:-

(i) Central and State Government Departments / Establishments

(ii) Local Authority

(iii) Government Agencies

(iv) An Authority / Board / Any other Body set up by an Act of Parliament / State Legislature or established by any Government with fifty-one percent or more participation by way of equity or control to carry out any function

(v) Society established by Central Government or State Government or a Local Authority under Societies Registration Act,1860 (21 of 1860) (vi) Public Sector Undertakings(Central and State)  TDS amount is required to be deposited in Government aØ

3-What is GSTR-7 ?

GSTR-7 is a monthly return to be filed by the persons required to deduct TDS /TCS under the GST

GSTR 7 is a return to be filed by the persons who is required to deduct TDS (Tax deducted at source) /TCS (Tax collected at source )under GST. GSTR 7 contains the details of TDS/TCS deducted, TDS/TCS liability payable and paid, TDS/TCS refund claimed if any etc.

4- Who needs to register under GST as a TDS ?

TDS stands for Tax Deducted at Source (TDS). All Governments, Government undertakings, Local Authorities and other notified entities making contractual payments in excess of INR 2.5 Lakhs to suppliers need to register as a TDS under GST. In the GST regime, while making such a payment in excess of INR 2.5 Lakhs, the concerned Governments, Government undertakings, Local Authorities and other notified entities needs to deduct 1% under CGST Act and 1% under SGST Act; In case of inter-state transactions, 2% (under IGST Act) of the total payable amount and remit it into the appropriate GST account. Credit of such GST payments will be given to the suppliers.

5- Who needs to register under GST as a TCS?

 TCS stands for Tax Collected at source. In the GST regime, every e-commerce operator needs to collect 1% under CGST Act and 1% under SGST Act; In case of inter-state transactions, 2% (under IGST Act) on the net values of taxable supplies made through the e-commerce operator.

6- Are there any preconditions I must fulfill before registering with GST as a TDS or TCS? The preconditions are:

        1. For Registration as Tax Deductor: Applicant has valid PAN or TAN.

        2. For Registration as Tax Collector: Applicant has valid PAN.

        3. Applicant must have a valid mobile number.

        4. Applicant must have valid E-mail ID.

        5. Applicant must have the prescribed documents and information on all mandatory fields as                                                           required for registration.

        6. Applicant must have a place of business.

        7. Applicant must have an authorized signatory with valid details.

7- Do I get registered automatically after submitting the registration application along with the prescribed documents?

No, your registration application will be processed and approved by the relevant Tax Officer, only then will you be issued the registration certificate and GSTIN.

8-When is TDS under GST required to be deducted?

The above persons are required to deduct TDS at 2 % where the total value of such supply, under an individual contract, exceeds INR 2,50,000 (excluding the amount of GST). This also means that TDS would be deducted on the value exclusive of GST and no TDS would be deducted on the GST component.

9-Compliances to be met by TDS deductor

*Registration as TDS deductor: A TDS deductor is required to register compulsorily without any threshold limit. The deductor has a privilege of obtaining registration under GST without requiring PAN. He can obtain registration using his Tax Deduction and Collection Account Number (TAN) issued under the Income Tax Act.

*Depositing TDS with the government: The deductor has to deposit the TDS to the government by 10th of succeeding month and file GSTR 7, based on which the supplier would be able to claim the credit of TDS.

*Issuing TDS certificate: The deductor is also required to issue the TDS certificate to the deductee in form GSTR-7A, this needs to be done within 5 days of remitting the TDS to the government.

10-How can deductee claim the benefit of TDS under GST?

Any amount deducted as TDS and reported in GSTR 7 will automatically reflect in the electronic cash ledger of the deductee. The supplier can take this amount as credit in his electronic cash register and use the same for payment of tax or any other liability.

11- Last date & Number of fillings

Filing of GSTR 7 for a month is due on 10th of the following month. For example due date of GSTR 7 for October is 10th November. You have to file it once in every month.

12- Late filing & interest

If you fail to file the GSTR-7 return within due time limit then you have to pay a late filing amount of 200/- per day with the interest .

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