CA Pratibha Goyal | Jul 22, 2021 |
Negative Liability Issues in GST CMP 08 on GST Portal
There are many Taxpayers who are facing issues and are not able to furnish the return and create the challans because of the negative liability in GST CMP 08 on GSTN Portal.
Form CMP-08 is a Quarterly Statement for payment of self-assessed tax which is required to be filed by every registered person registered under the Composition Scheme.
Negative Liability means in case of any negative entry in the present quarter that shall be carried forward to the next quarter.
This can be explained as follows:
The Details of Sales & Purchase under Reverse Charge [RCM] to be reported in CMP-08 and GSTR-4 must be on-net basis after making certain adjustments if any. The gross values should be adjusted for any advances received credit and debit notes, as well as any subsequent amendments due to rectifications in invoices. The relevant tables for reporting in this manner are Table 5 and Table 6 of GSTR-4 and Table 3 of CMP-08.
Due to this sometimes we may have negative figures where the net value becomes negative and thus tax payment becomes negative.
In case of a negative liability in any tax period of a composition taxpayer (and if no amount is required to be paid by the taxpayer (during that period)), the said negative liability will be maintained in the Negative liability statement. This negative balance lying in the negative liability statement will be automatically adjusted against the liabilities of the subsequent tax period(s).
For e.g. for filing GST CMP-08 for quarter Apr-Jun 2019, negative values from last quarter Jan-Mar 2019 of GSTR-4 will be adjusted and shown in this column.
If you have filed GSTR-4 for FY 2020-21 you were required to give details in Table 6 of Form GSTR-4. But many taxpayers have simply filled Table 5 [ Summary of self-assessed liability as per FORM GST CMP-08] and Paid Tax as per Table 8 [Tax, interest, late fee payable, and paid]. But if you have not filled table 6, GSTN has considered the same as a negative liability to be carried forward to subsequent periods.
Now as a result Taxpayers are getting negative liability of Last year in CMP-08 of Q1 of FY 2021-22 and the same is being offset from Tax Liability of this year.
Please note that there is no means to revise GSTR-4 or CMP-08 for those who have already filed GSTR-4. Those who have still not file GSTR-4 should be careful in terms of filing the Data so that this situation does not arise.
For those who have filed GSTR-4, one of the following can be done:
Hopefully, the government will come out with a way out for the same. Also, it is a humble request to the government that taxpayers should not be punished as this was just a genuine error and not a misstatement on part of the taxpayer.
Disclaimer: These are just some suggestions for rectifying the issue. The same is not suggested by CBIC. Nowhere I am suggesting you to strictly follow to the same.
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