How to file DRC 03 Form: Make voluntary payment in GST

What is DRC 03

DRC 03 is a form used to make the tax payment, interest and penalty on a voluntary basis. Thus, a taxpayer can make any type of taxes mentioned above on a voluntary basis before receiving notice from the department. Also, He can make the payment against show cause notice within 30 days of its receipt.

Format of DRC 03

Below is the format of DRC 03. One can use this format for offline use. However, for making payment taxpayers needs to fill this form online on the GST portal. You may also download the pdf format by clicking the download button.

Download

Read to know Adjust GST Payment through DRC 03A

How to file DRC 03 in GST?

The DRC 03 filing process is very easy. Here is the step by step procedure explaining how to create DRC 03 challan for making payment.

1. Open your Internet browser >> Type www.gst.gov.in >> Enter

2. Login to the GST Portal with your valid credentials.

3. Click on the Services > User Services > My Applications command.

4. Select the “Intimation of Voluntary Payment – DRC – 03″ from the Application Type drop-down list.

5. Click on Create Application

6. Select the Cause of Payment from the drop-down list.

In Case of show cause notice(SCN): Select Manual Entry from the SCN Reference Number drop-down list. Further, Select the SCN Issue Date using the calendar. Please note that the SCN Issue date should be within the last 30 days.

7. Select the particular section no. against payment has to be made

8. Select the Financial Year from the drop-down list.

9. Select the From date and To Date for Overall tax Period from the drop-down list.

10. Enter the Details of payment made including interest, penalty, and others.

Note: You make the DRC 03 payment through ITC i.e from the credit ledger. Balance payment of liabilities shall be paid through cash including interest and penalty.

11. Click the PROCEED TO PAY button.

The liability page will be displayed. Also, you will see the available cash and credit ledger balance. Please note that you can not utilize the input tax credit for making payments of Interest and penalty if any.

12. Enter the payment details and Click on SET OFF button. Please note that you can make drc 03 payment through ITC.

13. A payment confirmation message is displayed. Click the OK button. A success message is displayed. Payment Reference Number (PRN) is displayed on the screen. Click the OK button.

14. Verify the details and proceed to file the Application through “DSC or EVC”.

Official Video by GSTN for DRC 03

DRC 03 – Payment of Penalties under GST

Recent changes in GST penalty regulations emphasize stricter compliance for timely tax payment and return filing. Taxpayers now face higher penalties for non-payment, incorrect filings, or delays in addressing discrepancies. Penalty amounts vary based on the nature and duration of non-compliance, with additional interest charges applicable on unpaid dues. To mitigate penalties, taxpayers are encouraged to use Form DRC-03 proactively for voluntary payments of taxes, interest, or penalties. Regular updates to GST rules make it essential for businesses to stay informed to avoid financial liabilities.

Common User Errors and Resolutions

Error: Incorrect Selection of Liability Type
Resolution: Ensure the correct tax, interest, or penalty type is selected under the cause list before proceeding to payment. Refer to the updated guidelines on the GST portal.
Error: Insufficient Balance in Ledger
Resolution: Check the balance in both the cash and ITC ledgers. Add funds if required to complete the payment seamlessly.
Error: Submission Failure Due to System Glitch
Resolution: Clear your browser cache or switch to an updated browser version. Retry after verifying portal maintenance schedules.

These steps help minimize common mistakes during DRC-03 filing.

Frequently Asked Questions

What is the full form of DRC 03?

The full form of DRC 03 is Demands and Recovery Form under GST

Can I make partial payment against show cause notice?

NO, the GST portal does not allow to make partial against show cause notice issued.

What is Voluntary Payment in GST?

Voluntary payment is making payment before you receive a show-cause notice asking to make the payment of tax dues.

When can I find the rules of DRC 03?

Rule 142(2) and 142(3) of the CGST Rules, 2017 define the procedure to be followed for DRC 03.

What kind of payments can be done through DRC 03?

Payments of GST Audit, Investigation, Voluntary Payment, Show cause notice, Annual Return, Reconciliation Statement or Others can be done through DRC 03 challan.