Late Fee Rationalisation & Amnesty – Annual Return (Sec. 44)

Notification No.: 07/2023 – Central Tax
Date of Notification: 31st March 2023

Relevant Sections and Rules:

• Central GST Act, 2017:
  • Section 44 – Annual return filing
  • Section 47 – Levy of late fee
  • Section 128 – Power to waive late fee

Summary of Notification:

1. This notification provides waiver/reduction of late fees under Section 47 in respect of annual returns (Section 44) to be filed for FY 2022-23 onwards.
2. The revised late fee structure is as follows:
   • Registered persons with turnover up to ₹5 crore: ₹25 per day, subject to a maximum of 0.02% of turnover in the State/UT.
   • Registered persons with turnover above ₹5 crore and up to ₹20 crore: ₹50 per day, subject to a maximum of 0.02% of turnover in the State/UT.
3. For past financial years (2017-18 to 2021-22), if the pending annual returns are filed between 1st April 2023 and 30th June 2023, the late fee shall be capped at ₹10,000 per return, irrespective of turnover.
4. This effectively introduces a compliance amnesty scheme for taxpayers to file pending annual returns at a reduced late fee and provides rationalization of fees for future years.

Source: Notification No.: 07/2023 – Central Tax