New GSTR-3B Table 3.1.1 requires ECOs to report Section 9(5) supplies separately. This mandates cash tax payments and prevents incorrect ITC claims.
Table 3.1.1 of GSTR-3B is where supplies under Section 9(5) are reported. Under Section 9(5), e-commerce operators (ECOs) are liable to pay GST on certain notified services such as restaurant and cab services supplied through their platform. The ECO reports these in Table 3.1.1(i) and pays the tax, while the actual supplier reports them as nil-taxable in Table 3.1.1(ii).
According to CGST notification 14/2022, issued on July 5, 2022, GSTR-3B now includes a new Table 3.1.1. This table requires both electronic commerce operators (ECOs) and registered suppliers making online sales to report transactions conducted under Section 9(5) of the CGST Act, 2017.
Introduction to Table 3.1.1 of GSTR-3B
Table 3.1.1 was introduced to enable both e-commerce operators and sellers to declare their sales and corresponding tax liabilities for a given period. Under Section 9(5) of the CGST Act, 2017, an electronic commerce operator is obligated to remit tax on specific government-notified services when provided via their platform. These services include:
- Accommodation services
- Passenger transport services
- Restaurant services
- Housekeeping services
E-commerce operators must report these Section 9(5) supplies in Table 3.1.1(i) of GSTR-3B, ensuring they are excluded from Table 3.1(a). The tax for these supplies must be paid in cash, as Input Tax Credit (ITC) cannot be utilized.
Similarly, any registered individual supplying services through an ECO, as specified under Section 9(5), must declare these supplies in Table 3.1.1(ii) and exclude them from Table 3.1(a) of GSTR-3B. Such registered persons are also required to settle the applicable tax in cash, without using ITC.
Who Must Report Details in Table 3.1.1 of GSTR-3B
Taxpayers required to report information in Table 3.1.1 of GSTR-3B include:
- Electronic commerce operators responsible for tax payment on specific government-notified services, such as accommodation, passenger transport, restaurant, and housekeeping, when these are facilitated by the ECO (e.g., Swiggy, Zomato, Ola, Urbancompany).
- Any registered individual who provides the aforementioned services through an electronic commerce operator, for instance, restaurants listed on platforms like Swiggy.
Date of Applicability for Table 3.1.1 of GSTR-3B
Table 3.1.1 became accessible on the GST Portal starting August 1, 2022. These revisions are applicable to GSTR-3B returns for periods from July 2022 onwards, filed from August 2022. The updates are currently active on the GST portal.
Format of Table 3.1.1 of GSTR-3B
The structure for reporting supplies in the new GSTR-3B Table 3.1.1 is provided below.
Impact on E-commerce Operators and Suppliers
Previously, online merchants encountered challenges in reconciling sales from e-commerce platforms, as certain values destined for Table 3.1.1 were not separately mandated in GSTR-3B. Additionally, some e-commerce operators incorrectly offset tax liabilities using Input Tax Credits. The new requirements ensure independent tracking and monitoring of these specifics, promoting improved compliance and reporting.
E-commerce operators and e-tailers must now maintain distinct sales records for the specified services to align with the notification’s directives.
The Indian government is intensifying its oversight and strengthening tax liability payments to enhance vigilance. This necessitates that e-commerce operators and e-tailers adopt advanced reporting methods and robust compliance management practices.
Furthermore, real-time ERP updates for sales are crucial for e-commerce operators and e-tailers, as inaccuracies or errors could result in penalties, interest, and legal disputes.
Frequently Asked Questions (FAQ)
What is Table 3.1.1 of GSTR-3B?
Table 3.1.1 is the section of GSTR-3B used to report supplies covered by Section 9(5), where the e-commerce operator, rather than the supplier, is liable to pay the GST.
What is Section 9(5) of the CGST Act?
Section 9(5) makes the e-commerce operator liable to pay GST on specified services supplied through its platform, such as passenger transport, restaurant, and accommodation services.
Who reports in Table 3.1.1(i) and (ii)?
The e-commerce operator reports the supplies and pays tax in Table 3.1.1(i), while the underlying supplier reports the same supplies as nil-taxable in Table 3.1.1(ii) to avoid double taxation.
Do restaurant services on apps fall under 9(5)?
Yes. For notified restaurant services supplied through an e-commerce platform, the operator collects and pays the GST under Section 9(5) and reports it in Table 3.1.1.
