GSTN has enabled Form GSTR 2B in the GST Portal. The Taxpayer can log in with there login credentials then go to F.Y 20-21 for July 2020, the Form GSTR-2B is available on the Portal. The GST Council, in its 39th meeting held March 2020, had recommended to adopt and implement the incremental approach of linking the present system of filing of GSTR-3B and GSTR-1 and other significant changes like enhancements in GSTR-2A and its linking to GSTR-3B. One such enhancement that the Council recommended was the introduction of an auto-drafted input tax credit (ITC) statement which would aid in assisting/determining the input tax credit that is available for every taxpayer.

Form GSTR-2B is going to be such an auto-drafted 1TC statement which will be generated for every registered person on the basis of the information furnished by his suppliers in their respective GSTR-1, 5 (non-resident taxable person) and 6 (input service distributor). Presently, GSTR-2A is a statement which is dynamic in nature and it changes as and when suppliers used to file their GSTR-1. But in GSTR 3B, every taxpayer needs freeze their ITC figure by 20th of the Month and discharge their tax liability in case, if required. Therefore, there is always a need to have a static report from where both the Tax Payer and Departmental People have an idea of Input Tax Credits eligible to be availed as on the date of filing GSTR-3B. GSTR 2B is such a static statement and will be made available for each month, on the 12th day of the succeeding month. It is expected that GSTR-2B will help in reduction in time taken for preparing a return, minimizing errors, assist reconciliation & simplify compliance relating to filing of returns.

Key features in GSTR-2B which would assist taxpayers in return filing are as under:

i. It contains information on the import of goods from the ICEGATE system including inward supplies of goods received from Special Economic Zones Units/Developers. This is not available with the release of GSTR-2B for the month of July and will be made available shortly.

ii. A summary statement that shows all the ITC available and non-available under each section. The advisory given against each section clarifies the action to be taken by the taxpayers in their respective section of GSTR-3B;

iii. Document-level details of all invoices, credit notes; debit notes etc. are also provided both for viewing and download;

  • GSTR-2B for the month of July 2020 has been made available on the common portal on a trial basis.
  • Since this is the first time that the statement is being introduced, taxpayers are advised to refer to GSTR-2B for the month of July 2020 only for feedback purposes.
  • All taxpayers are requested to go through their GSTR-2B for July 2020 and after comparing the same with the credit availed by them in July 2020, provide feedback (if any) on any aspect of GSTR-2B by raising a ticket on the self-service portal (https://selfservice.gstsystem.in/)
  • All taxpayers are advised to view the detailed advisory relating to GSTR-2B on the common portal before using the statement.

Taxpayers can access their Form GSTR-2B through: Login to GST Portal > Returns Dashboard > Select Return period > GSTR-2B.

Therefore, the process of ITC Reconciliation every month shall be on the basis of GSTR 2B in future. The probable steps that we may follow:

1. Download GSTR 2B on 12th of Every Month once it is available in the portal

2. Prepare the ITC Statement as per accounts before hand so that reconciliation can be done faster.

3. There may have invoices which are shown in GSTR 2B by supplier but the same is not booked in accounts due various reasons i.e GRN is pending, Invoices not received from Vendor etc.

4. There may have some invoices having invoice date of prior months, but the same is booked in the current month and not appearing in the GSTR-2B in the current month.

All such adjustments needs to be done with the figures appearing in GSTR 2B to reach to the ITC figures as per accounts. We have to remember that GSTR 2B is merely a statement to enable us to easily reconcile our data with a static report which will not change in future. But availability of ITC shall always be guided through Section 16 where four basic conditions have been provided, namely-

1. Receipt of Tax Invoices/ Debit Notes

2. Receipt of Goods & Services

3. Supplier has paid the Tax Charged on the Invoice and

4. Tax Payer has filed the return

Therefore, if the aforesaid four conditions are satisfied, then ITC can very well be availed by the Tax Payers.

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9 Comments

  1. Praveen says:

    All these “advancements” ignores a basic fact that a large number of GST registrants file GSTR1 every 3 months. So this data can be used as an indicator to see if any additional “credit” like from banks is available. The 10% rule is trying to encourage larger registrants not to buy from small MSME sector and trying to force them to file every month when they are not required to is also unfair.
    Finally if you have all your purchase bills, this can be used to find out which vendor has not filed GSTR1.

    1. Joydeb1984 says:

      As GSTR 2A is a dynamic report, it constantly changes based on the GSTR-1 filed by suppliers. But, every tax payer used to file GSTR 3B by 20th of the Next Month. Further, Rule 36(4) has given restriction of 10% of credit for which you need to reconcile books with a report which will remain constant on the date of filing the GSTR-3B. That’s why GSTR 2B comes into picture which will be generated on 12th of every month and it will be remained constant. But in near future government may force you to avail credit on the basis of GSTR 2B only.

    1. Tax update says:

      As stated by Joydeb Sir, 2A is dynamic report which keeps of changing as it fetches the invoice details as and when the supplier files GSTR-1 or amends it. But GSTR-2B is a constant summary statement which will be made available to taxpayer by 12th of subsequent month with the details of the supplier filed upto 11th of subsequent month.

  2. Palash Mathur says:

    Sec 16 ITC basis will not be considered. The main objective of the Govt is to restrict ITC as per 2B which will auto populate in GSTR 3 B. Provisional basis ITC was first tried to be curtail by notification no. 49 of 2019 inserting clause 4 to rule 36 to 20% then brought down to 10% now this 2B.

    1. Joydeb1984 says:

      Agreed Sir. But provisions in the Section always be considered first before considering any notification or rules. Rule always guides regarding procedural aspect of law provided in the act. Therefore, if you compare Rule 36(4) with Section 16, then it is very clear that Rule 36(4) is basically ultra vires to the provisions of Section 16. Therefore, in my view, eligibility of ITC shall always be guided through the four conditions specified in Section 16.

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