Deferred Payment or Payment in Installment of GST Demand: Under GST, any individual engaged in trade and commerce can apply to the commissioner under Section 80 of the CGST Act to extend the time for GS Interest, Penalty, GST payment, or any sum of amount. The person taxable can also apply for payment in installments.
The primary condition is that such GST or other amounts should not be due as per the liability self-assessed in any return. Therefore, the only charge payable due to a demand notice can be deferred or paid in installments.
The number of installments cannot be more than twenty-four, and the person is also liable to pay interest at the rate of 18% under Section 50 of the CGST Act.
If the person defaults in the payment of such installment on its due date, the whole outstanding amount becomes payable on the date of default.
- Conditions where this facility is prohibited
- The procedure of filing an application
- Steps to file form GST DCR-20
Conditions Where This Facility is Prohibited
- The taxable person has hitherto defaulted to pay any amount for which the recovery procedure is on.
- The taxable person has been prohibited from making payment in installments in the preceding financial year.
- The amount for which an installment facility is pleaded for, less than the number of rupees twenty–five thousand.
Procedure of Filing an Application
For applying under section 80, GST DRC-20 is required to be filed. The commissioner shall make a call for a report directly from the jurisdictional officer regarding the financial ability of the concerned taxable person to pay the said amount; on receiving an application.
After considering the report of the jurisdictional officer, the commissioner (in FORM GST DRC- 21) may issue an order allowing the taxable person additional time to make the payment or to pay the amount in such monthly installments, not exceeding twenty-four, as he may deem fit.
Steps to file form GST DRC-20
- Step 1: Logging in to the GST portal
- Step 2: Going to form GST DRC-20. There are two ways to open the form.
- Method 1: involves clicking on “Go to Services,” then to “Payments,” and finally “Application for Deferred Payment” or “Payment in Installments.”
- Method 2: involves going to “Go to Services,” then to “User Services,” then to “My Applications,” and selecting “Application for Deferred Payment” or “Payment in Instalment,” and finally clicking on “New Application.”
- Step 3: Filling the Demand Id in the box. If no demands are outstanding, a message will appear at the top of the screen.
- Step 4: Filling in your Demand ID. The tax period will be filled automatically. First, you have to choose between deferring the payment or paying in installments. If the installment option is selected, enter the number of installments in which you want to pay. If the Deferred Payment option gets elected, the taxpayer has to pick the proper ‘Due date of payment” from their calendar. Next, they have to upload certain supporting documents, if any is needed, and finally file the form.
The ARN will be generated and sent to the taxpayer’s email and SMS. Then, you can check the status of the application by clicking on “Services,” then clicking on “User Services,” and selecting the option for “My applications.”