Tax Deducted at Source (TDS) under GST is an important compliance requirement for specified entities. Timely filing of returns ensures smooth credit flow and avoids penalties.

What is TDS under GST?

As per Section 51 of the CGST Act, 2017, certain notified persons are required to deduct TDS when making payments to suppliers.

Key highlights:

• Applicable when contract value exceeds ₹2.5 lakh (excluding GST)
• TDS rate:
  • 2% (1% CGST + 1% SGST) for intra-state supply
  • 2% IGST for inter-state supply
• Deducted amount is reflected in the supplier’s electronic cash ledger

Entities required to deduct TDS include:

• Government departments
• Local authorities
• Government agencies
• Public sector undertakings and notified bodies

Return Form: GSTR-7

The details of TDS deducted and deposited are reported in Form GSTR-7.

This return includes:

• TDS deducted
• Tax liability and payment details
• Refund claims (if any)

Due Date for April 2026

For the tax period April 2026, the due date for filing GSTR-7 is:

• 10th May 2026

This follows the standard rule that GSTR-7 must be filed by the 10th of the succeeding month.

Important Compliance Points

• Timely filing is mandatory, even if no TDS is deducted (Nil return required)
• Late filing attracts:
  • Late fee of ₹200 per day (₹100 CGST + ₹100 SGST), subject to limits
• Ensure reconciliation with:
  • Books of accounts
  • Vendor records
• TDS certificates (Form GSTR-7A) must be issued to deductees

Recent Developments

• As per GST updates effective from 1 April 2025, invoice-wise reporting in GSTR-7 has been introduced via CBIC notifications (e.g., Notification No. 9/2025 – Central Tax), although system-level implementation is evolving.

Conclusion

Businesses and government entities liable to deduct TDS under GST must ensure accurate deduction, timely deposit, and filing of GSTR-7 by 10th May 2026 for April transactions. Proper compliance helps avoid penalties and ensures seamless credit availability to vendors.