How to Pay GST Online?

Paying taxes was painful in the earlier years. With the advent of Goods and Service Tax, taxes are now simple. Businesses needed to be careful about the various taxes that they had to pay; such as service tax, value-added tax, and several other indirect taxes levied by the Central and State governments.

As a result of the advent and implementation of GST, people in general, have become more aware of indirect taxation. By harmonizing the tax scheme for the center and the states, the tax system is much fairer for all.

An enterprise must calculate how much tax it must pay in cash after deducting the input tax credit. This article will give you a step-by-step explanation of how to pay GST online.

Overview of Payment Process of GST
Who Should Pay GST?
What are the Options to make the GST payment?
How to pay GST Online?
Generating Challan on GST Portal
Duration to Complete GST Payment
What Happens if Challan has Wrong Entries?

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Overview of Payment Process of GST

While the process of GST payment remains the same for all the taxpayers, the taxpayers must use a challan so that they can deposit money into their cash ledger. However, if they have enough cash balance then they may not have to transfer the amount to the electronic cash ledger.

Let’s look at the various categories of the taxpayers and the process of payment for each of them:

Regular Taxpayer

The regular taxpayer has to use the PMT-06 Challan to add the payment to the electronic cash ledger. This has to be done before they proceed to file their GSTR 3B.

Quarterly Taxpayer

These taxpayers who have chosen the QRMP scheme have to deposit tax in the first two months of a quarter. They can do so directly by making use of the PMT-6 and eventually pay while filing the returns of GSTR 3B for the last month of the quarter.

Payment Under QRMP Scheme

The Quarterly Returns and Monthly Payments (QRMP) scheme came into effect as of January-March 2021. A taxpayer may file GSTR-1 and GSTR-3B by the time the quarter ends under this scheme. The scheme has migrated the vast majority of GSTR-1 filers.

Tax payments for the first and second month of the quarter are due by the 25th of next month.

The taxpayer must select the 'Monthly payment for quarterly return' option when submitting the form PMT-06. Then they must select either the Fixed sum mode or the self-assessment method for payment.

Composition Taxable People

In challan CMP-08, these taxpayers must provide details of their sales and turnover for the quarter and pay the tax.

Taxpayers with NIL GST returns

As they have no purchases or sales, (and therefore, no bills or invoices), no taxes are due by these taxpayers for the relevant tax month or quarter.

Who Should Pay GST?

Any individual who is a supplier of goods or services must pay GST when the output tax liability is more than the input tax liability. To pay the Goods and Services Tax duly, the person must register under GST and obtain a GSTIN - GST Identification Number.

What are the Options to make the GST payment?

The mode of payment must be determined when generating the challan in Form PMT-06. The businesses can decide upon the mode based on the time available to file the returns before the due date.

Here are the modes they can choose from:

ONLINE

Net-banking
Debit Card or Credit Card

OFFLINE

OTC (Over the Counter): This includes Cash, Cheque, Demand Draft.
National Electronic Fund Transfer (NEFT) or Real-Time Gross Settlement (RTGS).

ONLINE Payment: Points to Know

The mode can be used to make payments with or without logging in to the GST portal.
After making the online payment, the electronic cash ledger is automatically updated.
If the challan is generated without logging in, then the payment must be completed immediately.

OFFLINE Payment: Points to Know

This mode can be used when the taxpayer’s bank is not listed in the card payment or net-banking list.
It can be used once the challan is generated, before or after signing in to the official GST website.
The mode requires taking a printout, fill the details, signing it, and finally submit it to the bank for completing the payment.
In the case of OTC, the banks take a couple of days, after which the electronic cash ledger is updated with the amount.
OTC allows payment of only up to Rs.10,000. If the amount is more than that, then other modes are to be adopted for payment.
NEFT and RTGS require the taxpayer to take a printout, sign it and submit it to the bank with the challan. The processing from the bank is completed in a few hours and a UTR (Unique Transaction Reference) is provided by the bank. The taxpayer must log in to the portal and use the UTR to link to the said challan. Thereafter, the cash ledger is updated with the amount.

How to Pay GST Online?

Once the GST challan is generated, login to the GST Portal and complete the following steps:

Step 1: Log in to the GST Portal with the correct credentials.

Step 2: Get the challan generated through this path: Services->Payments->Challan History.

Step 3: Choose the CPIN for which the payment is to be made.

Step 4: Selecting E-payment mode

If you choose Netbanking

Choose the bank through which you will make the payment.
Check the Terms and Conditions.
Make the payment.

Step 5: If you choose Credit/Debit Cards

Select the payment gateway.
Check the Terms and Conditions.
Make the payment.

The above step will lead you to a net banking page of the chosen bank. In case you want to change the amount, cancel this transaction and create a new challan.

Step 6: When the payment is successful, you’ll be taken to the GST portal which will display the transaction status and the payment receipt.

There’s a link to make another payment. If you wish to make another payment, click it.
View the cash ledger by clicking the Click here to view your Cash Ledger.

If you choose Over the Counter:

Step 1: Select Over the Counter as the payment mode.

Step 2: Select the Bank in which the cash/instrument is to be deposited.

Step 3: Choose the type of instrument: Cheque/Cash/Demand Draft.

Step 4: Click Generate Challan.

Step 5: Get the printout of the challan and visit the bank.

Step 6: Make the payment within the validity period through cash/cheque/dd.

Step 7: GST portal shall display the updated payment once the bank confirms.

If you choose NEFT/RTGS:

Step 1: Select the name of the Remitting Bank from the drop-down list.

Step 2: Click Generate Challan.

Step 3: Take a printout of the generated challan.

Step 4: Pay through the cheque or debit facility of your account.

Step 5: Once the bank processes the transaction, the same is confirmed by RBI within a couple of hours.

Step 6: You shall receive a UTR on mobile or e-mail id which you can link with the NEFT/RTGS on the GST website.

Access Challan History and click CPIN.
Enter your UTR and proceed to link it with NEFT/ RTGS payment.

Step 7: Once the bank confirms, the payment status will be updated on the GST portal.

Step 8: The payment will then be updated in the electronic cash ledger.

Generating Challan on GST Portal

Challan can be generated either before or after logging into the GST portal with your GSTIN.

Steps to take Before logging in to the GST portal

Step 1: On the GST homepage, access Create Challan option.

Step 2: Enter GSTIN and captcha.

Step 3: Add the respective amounts for CGST, SGST, IGST, whichever applies.

Step 4: On GSTIN/ other id Verification page, Re-enter GSTIN/Other Id for Challan Generation.

Step 5: Click Download to download the challan generated.

Steps to take After logging in to the GST Portal

Step 1: You can create your challan on the dashboard when you choose to log in to generate challan. The next steps will remain the same as that in the process before logging.

Step 2: On the dashboard, enter amounts under the respective heads.

Step 3: Choose the payment mode and click Generate Challan.

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Duration to Complete GST Payment

The time available to complete the GST payment is dependent on the date when the challan was generated.

In case the challan was created before logging in for the net-banking mode of payment, then the payment must be completed immediately.

If you selected the offline modes like the NEFT/RTGS, then the challan will be generated along with CPIN and get auto-saved. You can complete it within 15 days.

What Happens if Challan has Wrong Entries?

In case, you recognize that your challan amount or any other detail is wrong or needs to be changed, then you will have to create a new challan. You can use the same steps to create the challan as described above.

The old challan can be left without any actions as it will anyway expire in 15 days.

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Key Takeaways

The key points observed in the post are as follows:

We observed that the taxpayers must use a challan so that they can deposit money into their cash ledger for facilitating the GST payment.
GST payment can be done using both, Online and Offline modes.
For Online mode, you can choose Net banking, Debit card, or credit card.
For Offline mode, you may choose OTC which includes cash, cheque, and DD; you may also opt for NEFT or RTGS as an offline mode.