Know all about GSTR-7 a monthly TDS return under GST

What is GSTR-7?

GSTR-7 is a monthly return that must be filed by registered person who deduct tax at source (TDS) under Section 51 of the Goods and Services Tax (GST).

Who Can Deduct TDS Under GST?

Under GST law, the following entities are required to deduct TDS:

Departments or establishments of the Central or State Government
Local authorities
Governmental agencies
Entities notified by the government on the Council’s recommendation
Authorities or boards set up by the government with at least 51% government control (Notification No. 33/2017 – Central Tax (dated 15th September 2017)
Societies established by the government and registered under the Societies Registration Act, 1860 (Notification No. 33/2017 – Central Tax (dated 15th September 2017)
Public sector undertakings (PSUs) (Notification No. 33/2017 – Central Tax (dated 15th September 2017)

Any registered person receiving supplies of metal scrap falling under Chapters 72 to 81 in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), from other registered person” (Notification No 25/2024 dated 09/10/2024)

When is TDS Deducted?

TDS must be deducted if the total value of the supply under a contract exceeds ₹2.5 lakh. The applicable rates are:

Intrastate supply: 2% (1% CGST + 1% SGST)
Interstate supply: 2% IGST

Note: TDS should not be deducted if the supplier’s location and the place of supply differ from the state of the recipient’s registration.

Does threshold limit of ₹2.5 lakh include GST?

No, the threshold limit of ₹2.5 lakh for deducting TDS under GST does not include GST. For the purpose of tax deduction, the value of supply should exclude central tax, state tax, Union territory tax, integrated tax, and cess as mentioned in the invoice.

What is the Due Date for Filing GSTR-7?

The return must be filed by the 10th of the following month. For example, GSTR-7 for October should be filed by 10th November.

Filing a Nil GSTR-7

Even if no TDS is deducted in a month, a Nil GSTR-7 must be filed. This requirement was introduced by latest amendment through Section 124 of The Finance Act (No. 2) Act, 2024 (No. 15 of 2024), dated 16th August 2024.

Is there any late fees for filing NIL GSTR-7?

There will be no late fee at all for not filing the GSTR-7 return on time as notified by notification No. 23/2024–Central Tax dated 08/10/2024.

Invoice-Wise Details in GSTR-7

GSTR-7 must include invoice-wise details of the TDS deducted.

Penalty for Non-Filing of GSTR-7

If GSTR-7 is not filed on time, a penalty is levied:

Late fee: ₹25 under CGST and ₹25 under SGST per day (₹50/day total), capped at ₹1,000.
Interest: 18% per annum on the TDS amount payable, calculated from the day after the due date until the payment date.

There is no late fee on for delayed filing of NIL GSTR-7 as per notification No. 23/2024–Central Tax dated 08/10/2024.

Can GSTR-7 Be Revised?

No, once GSTR-7 is filed, it cannot be revised. Any changes or corrections must be adjusted in the subsequent month’s return.

Is registration mandatory for a tax deductor under GST?

Yes, registration is mandatory for a tax deductor under Section 24(vi) of the GST Act. A person required to deduct TDS under Section 51 of the GST Act must compulsorily register for GST, regardless of any threshold limit. The registration can be obtained TAN or PAN based.