• Question on GST 20L limit and LUT

Hey guys,

I've been freelancing with a client in the US from April 2020 and I'm getting close to the GST threshold limit of 20L (I offer software services and my export income is around 20L). Now since I'm close to this limit I've registered for GSTIN in December 2020. I haven't crossed the limit yet.

I've been reading that as long as you're < 20L then you don't need to register for GST for export of services and more importantly don't have to pay GST. I have questions on filing and GST Law.

(1) Do I need to file for all the previous invoices for the services I've exported before getting GSTIN, from 0 INR to 20L? I.e the invoices from April 2020 to Dec 2020 when my turnover was <20L. Note, I got my GSTIN in Dec 2020.

(2) Do I file returns only for the invoices I raise from the date I get the GSTIN? In this case I'll be ignoring all the invoices till 20L that happened before getting my GSTIN and only filing for invoices from this point onwards in 2021. 

I don't want to be hit with a late fee or an audit.

(3) Also my third question is on the validity of LUT. If I apply for an LUT now for FY 20-21, is it valid for all the exports and invoices I raised for the entire FY 20-21? or only on exports and invoices I raise from this point in time onward?
Asked 6 days ago in GST

Dear Sir,

 

Hope you are doing well !!

 

The law provides that, if you have taken registration within 30 days of being liable to be registered, then your registration is effective from the date you were liable to be registered.

So in that 30 day period in between, initially you would have issued non GST invoice, but after getting the registration certificate, now you can issue revised GST invoice for those invoices issued in those 30 days.

 

1. The invoices from April 2020 to Dec 2020 when your turnover was <20L. 

 

2.You need to file returns only for the invoices you raise from the date you get the GSTIN.

 

3. For entire FY.

 

We may assist you in entire GST compliances & filings.

 

It is advisable to take a phone consultation for detailed discussion.

Payal Chhajed
CA, Mumbai
5010 Answers
120 Consultations

5.0 on 5.0

1. No

2. From the date of registration

3. Till 31.03.2021

 

Retains FIRC from bankers. Claim refund of ITC on business expenses. From Jan 2021, only quarterly returns will be filed i.e. only 8 returns per year.

 

For detailed discussion, please contact personally.

Vivek Kumar Arora
CA, Delhi
3936 Answers
294 Consultations

5.0 on 5.0

- Portal allows you to post invoices from the date of registration only.

- LUT is valid for complete financial year or from the date of application till the close of financial year.

- You will be required to report GST turnover in the ITR. At that point there will be a difference between turnover reported in ITR and GST. Prepare reconciliation statement for that.

Vivek Kumar Arora
CA, Delhi
3936 Answers
294 Consultations

5.0 on 5.0

Yes, you don't need to file the invoices that you raised before you got GSTIN.

 

The Letter of Undertaking filed will be valid for whole financial year in which it is furnished. 

Payal Chhajed
CA, Mumbai
5010 Answers
120 Consultations

5.0 on 5.0

Hi 

 

All the invoices post GST registration shall have to be declared in GST returns. Invoices prior to GST registration shall not be reported.

 

LUT is applicable from the date of application of LUT.

Lakshita Bhandari
CA, Mumbai
5367 Answers
440 Consultations

5.0 on 5.0

I assume you would have applied for LUT immediately after getting GST registration, LUT would be applicable for all invoices raised post such date.

Lakshita Bhandari
CA, Mumbai
5367 Answers
440 Consultations

5.0 on 5.0

Hi

 

You will report 5 lac only in GST. There won't be any issue with income tax. You will also report your GSTIN and turnover as per GST in ITR.

 

As far as LUT is concerned, though relaxations are provided many times and LUT is considered applicable for entire FY for which it is applied, but you need to write a letter to your jurisdictional officer for the same. Thus it should be ensured that LUT is filed right after GST registration and then only invoices are issued.


Please note that since you will be exporting services under letter of undertaking and will be receiving remittances in a foreign currency, your services will be classified as zero rated. You don't need to pay any GST, only the invoice value needs to be mentioned in the GST returns.


FYI, today is the last day to submit GSTR 1 for the quarter ending December 20.

Lakshita Bhandari
CA, Mumbai
5367 Answers
440 Consultations

5.0 on 5.0

- invoices raised after obtaining LUT will be exempt from tax. You need not to pay any tax on it.

- Apply LUT immediately after obtaining registration bcz you are providing export services.

-  Today is last date for filing of GSTR-1 for quarter ending 31.12.2020. Last date for GSTR-3B of GSTR-3B is 24.01.2021. Don't forget to claim ITC on GST paid to payment gateways.  Check your GSTR-2A/2B for the same. Claim refund of ITC.

- Simultaneously you can also check your GST turnover in Form 26AS.

Vivek Kumar Arora
CA, Delhi
3936 Answers
294 Consultations

5.0 on 5.0

Once you are registered under GST whether voluntarily or whether after crossing limit you have to do all GST compliance.

 

Hope you find the information helpful if you do please rate it 5 and if you need further discussion you can book a phone consultation.

Thank you

Naman Maloo
CA, Jaipur
3751 Answers
43 Consultations

5.0 on 5.0

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