DRC-03A: The Key to Adjusting Unresolved GST Payments!

Navigating the complexities of Goods and Services Tax (GST) can be challenging for businesses, especially when it comes to handling unresolved payments. One of the critical tools that can streamline this process is the DRC-03A, a form designed to help businesses correct errors or omissions in GST payments. 

Let’s understand the changes!

Advisory dated 5^th November 2024

Advisory for Form GST DRC-03A

Nov 5th, 2024

1. It has been observed that some taxpayers have paid the demanded amount vide DRC 07/DRC 08/MOV 09/MOV 11/APL 04 through DRC-03 instead of using the payment facility ‘Payment towards demand’ available on the GST portal. This led to a situation where the demand has been paid by the taxpayer, however, the demand is not closed in the electronic liability register. To address this issue, the government has notified a new form named GST DRC-03A which was notified vide Notification No. 12/2024 dated. 10th July 2024.

2. Accordingly, GSTN has developed the new Form GST DRC-03A on the GST portal which is available now to adjust the paid amount through DRC-03 against the corresponding demand order. Therefore, it is advised to the taxpayers to use the DRC-03A form to link the payment made vide DRC-03 with the demand order. Only DRC-03 forms where the cause of payment is either ‘Voluntary’ or ‘Others’ can be used in Form GST DRC-03A.

3. Taxpayers will be required to enter the ARN of the DRC-03 along with the relevant demand order number on the portal. Upon entering the ARN and selecting the demand order number of any outstanding demand, the system will auto-populate relevant information of the DRC-03 form as well as from the specified demand order against which the payment is to be adjusted.

4. Once the adjustment is made, corresponding entries will automatically be posted in the taxpayer’s liability ledger to reflect the updated status of demands.

5. For a detailed process, please click on Detailed Advisory.

6. Taxpayers may refer to the FAQs on the same topic.

7. In case taxpayers face any technical issue, a ticket shall be raised under the category ‘DRC-03A-Filing’ on the Grievance Redressal Portal: https://selfservice.gstsystem.in

ThankingYou,
Team GSTN

Key Highlights of the advisory

• Introduction of GST DRC-03A: The new GST DRC-03A form has been introduced to address the issue of taxpayers who mistakenly paid demands through DRC-03, instead of using the 'Payment towards demand' option available on the GST portal.
• Purpose of GST DRC-03A: The form allows taxpayers to link payments made via DRC-03 to the corresponding demand order, ensuring the demand is correctly closed in the electronic liability register.
• Eligible DRC-03 Forms: Only DRC-03 forms where the cause of payment is marked as ‘Voluntary’ or ‘Others’ can be used with the DRC-03A form.
• Benefits for Businesses: How using DRC-03A can help avoid penalties, ensure compliance, and streamline your GST payment adjustments.
• Steps for Adjustment: Taxpayers need to enter the ARN of the DRC-03 and the relevant demand order number on the GST portal. The system will auto-populate the necessary details for seamless adjustment.
• Automatic Ledger Update: After adjusting the payment, the system will automatically update the taxpayer's liability ledger, reflecting the updated demand status.
• Further Guidance: Taxpayers can refer to the detailed advisory and FAQs on the process, and for technical issues, they can raise a grievance under the category ‘DRC-03A-Filing’ on the GST Grievance Redressal Portal.

‍

Conclusion

The introduction of GST DRC-03A addresses a critical gap in the GST compliance process by allowing taxpayers to correctly link payments made through DRC-03 to the corresponding demand orders. This adjustment ensures that the taxpayer’s liability ledger is accurately updated, preventing any discrepancies in demand closure. By following the prescribed steps, businesses can avoid potential issues with unclosed demands and maintain compliance with GST regulations.

It is important for taxpayers to use the DRC-03A form when adjusting payments, especially if they were initially made under the ‘Voluntary’ or ‘Others’ categories. With the automated system for linking payments to demand orders, the process becomes smoother and more transparent, reducing the risk of errors. For any technical issues, taxpayers can rely on the GST Grievance Redressal Portal for support.

In summary, using GST DRC-03A ensures a streamlined and efficient way to manage GST demand adjustments, helping businesses stay compliant and avoid unnecessary complications.

‍