What happens If you don't File GST?

If you are a business owner in India, you are probably aware of the Goods and Services Tax (GST) that was implemented in 2017. It is a tax levied on the supply of goods and services, and it is mandatory for businesses with an annual turnover of over Rs. 20 lakhs to register under GST. However, some businesses may choose not to file their GST returns. In this blog, we will explore what happens if you don't file GST.

Firstly, if you don't file your GST returns, you will be liable to pay a penalty. The penalty for late filing of GST returns is Rs. 50 per day for each day of delay, subject to a maximum of 0.25% of your turnover. This means that if you delay filing your GST returns by a month, you will have to pay a penalty of Rs. 1,500 (30 days x Rs. 50).

Secondly, if you don't file your GST returns for an extended period, the government can take legal action against you. They can initiate a recovery process to collect the pending tax amount, and this could lead to further penalties and interest charges. It's worth noting that if you have not filed your GST returns for more than six months, the government can cancel your GST registration, and you will not be able to operate your business legally.

Thirdly, not filing your GST returns can impact your credit score. If you have outstanding GST dues, it can negatively affect your credit score, making it difficult for you to secure loans or credit in the future.

In conclusion, not filing your GST returns can have serious consequences. It can lead to penalties, legal action, and cancellation of your GST registration, and a negative impact on your credit score. Therefore, it is essential to file your GST returns on time to avoid any complications. As a business owner, you should be aware of the GST regulations and comply with them to avoid any legal issues.