What does Section 40 say?

Section 40 deals with the first GST return to be filed by a newly registered person. When a person becomes liable for GST registration and subsequently obtains registration, the first return must include details of supplies made during the period from the date on which registration became applicable up to the date registration was granted.

This provision ensures that transactions occurring during the intervening period are not left outside the GST framework. It helps maintain continuity of tax reporting and ensures that tax liability is properly discharged from the effective date of registration.

The section prevents revenue leakage and ensures that newly registered taxpayers account for all taxable supplies made from the date they became liable to register.

Simple Example

A business becomes liable for GST registration on 1st April but receives registration on 20th April. The first GST return must include eligible transactions undertaken between 1st April and 20th April.

Key Points

• Applies to newly registered taxpayers.
  • Covers supplies made before registration approval.
  • Ensures continuity in tax reporting.
  • Prevents omission of taxable transactions.
  • Supports accurate tax payment.
  • Forms part of initial GST compliance.

In One Line

Section 40 ensures that newly registered persons report and pay GST on supplies made from the effective date of registration.