Arjuna (Fictional Character): Krishna, Seasons of Festival have arrived, soon India just celebrated the festival of Rakshabandhan with full excitement but how and when the taxpayers would celebrate Rakshabandhan of GST i.e. to say matching and mismatching of GSTR-2A with Books of Accounts?
Krishna (Fictional Character): Arjuna, Rakshbandhan is celebration of the purest form of brother and sister bond. On this day sister ties Rakhi to brother’s Wrist, in return of the promise of her safety. Similarly in GST matching and mismatching of purchase/sale bond needs to be done to ensure the promise to claim ITC. This can be done by matching the details of GSTR-2A with purchases as shown in the Books of Accounts.
Arjuna: Krishna, what details are required to be verified from GSTR-2A and what possible issues can be faced by taxpayers?
Krishna: Arjuna, The Input Tax Credit can be claimed only if the same is matched and approved with GSTR 2A .Hence it is necessary for the Taxpayers to match the details of the purchases made by them with the sale details of its supplier. During this matching the taxpayer’s needs to match – Invoice Number, Date of Supply, Taxable Value, Tax rate and Amount of tax (CGST/SGST/IGST).
Arjuna: Krishna, What taxpayers should do if the supplier have furnished incorrect information in its GSTR-1?
Krishna: Arjuna, Suppliers show the details of sale in GSTR-1 and the same is auto populated in GSTR 2A of the recipient, if there are any mistakes in its GSTR-1, incorrect information gets displayed to taxpayers.
As the facility to file GSTR-2 in which these errors could be modified is postponed, the only option left is to tell the suppliers for amending the same in its GSTR-1.
Arjuna: Krishna, What to do if the Invoices are not uploaded by the suppliers in its GSTR-1?
Krishna: Arjuna, There can be instances where the supplier have not furnished its sale details in GSTR-1. The effect being non reflection in GSTR-2A of the recipient. In such case the supplier needs to be informed about such mismatch and rectification of the issue in its upcoming GSTR-1.
Arjuna: What probable issues can arise while matching GSTR-2A with books?
Krishna: Arjuna, When there is large amount of data in GSTR 2A, the taxpayers may face difficulties while matching GSTR 2A with books of accounts. For Ex: If the supplier has mentioned 16 digit invoice number in uploading GSTR 1, but the recipient have mentioned only 6 digits in his books then matching of the data on the basis of Invoice number would take efforts.Another problem is the frequency of matching GSTR 2A with books. Because of the effect arising out of the amendments made by the supplier in his GSTR 1 to correct any error, i.e. if taxpayers have already matched their GSTR 2A of July month and supplier amends the details in December GSTR 1, doing matching exercise again for the month of July would be tedious work.
Arjuna: Krishna, What lesson the taxpayer should take from this?
Krishna: Arjuna, filing of GSTR 2 is disabled as of now, to do any rectifications in relation to GSTR 2A. Because of this, if any change needs to be made to the details reflecting in GSTR 2A, the recipient should inform the same to the supplier. So that he can amend in its GSTR 1. Such rectifications can be possible only if there are strong ties between the supplier and the recipient. Therefore on this Rakshabandhan the supplier and the recipient should cherish their sweet bond to protect themselves from penalty if any.
Author Bio
Sir, my query is w.r.t. missing invoices in GSTR1 of the supplier for the month of April, 2018. Whether uploading missing invoice in GSTR1 for the month of May, 2018 is correct or uploading it in Annual GST return?
Please note, purchaser has already claimed ITC of April month invoice on provisional basis while discharging the liability through GSTR3B.