Filing of GSTR 3B is considered to be the simplest return form by the Government as it might include reporting of only 7 Figures i.e. Sales + Output IGST /CGST/SGST and Input IGST/CGST/SGST. Further the same is auto populated in GSTR 3B, based on GSTR 1 and GSTR 2B. Any manual modification in auto populated/system generated return form GSTR 3B is highlighted in Red as a mark of Danger Alert. Computing exact figures of Input & Output Tax might require many computations and preparing various reconciliations. In this article, we have tried to cover various scenarios while preparing reconciliation of GSTR 2B with Books of accounts for preparation of GSTR 3B. For easy understanding, various figures of ITC as per GSTR 2B, GSTR 3B and Books have been considered as IGST only.
| Sr. No. | Scenario | IGST ITC as per | ITC for GSTR 3B | Author’s Remarks | |
| Books | GSTR 2B | ||||
| 1 | Invoices as per books matches with GSTR 2B of the same month | ||||
| June Month | 1,000 | 1,000 | 1,000 | As Books = GSTR 2B | |
| 2 | Few Invoices as per books, but not reported in GSTR 2B | ||||
| June Month | 1,000 | 800 | 800 | ITC of Rs.200 can be claimed once reported in GSTR 2B | |
| 3 | Few Invoices as per books, but not reported in same month GSTR 2B, and reported subsequently | ||||
| June Month | 1,000 | 800 | 800 | ITC of Rs.200 can be claimed once reported in GSTR 2B | |
| July Month | 1,500 | 1,700 | 1,700 | GSTR 2B of July month includes ITC of Rs.200, not reported previously | |
| 4 | Few Invoices not posted in books, but being reflected in GSTR 2B | ||||
| June Month | 800 | 1,000 | 1,000 | Kindly ensure to get original invoice from your vendor and post in your books before GST Return submission | |
| 5 | Few Invoices posted in books as well as reflected in GSTR 2B, but ITC ineligible as per section 17(5) / /any other section | ||||
| Eligible ITC | 1,000 | 800 | 800 | Eligible ITC of Rs.200 can be claimed once reported in GSTR 2B | |
| Ineligible ITC | 300 | 300 | – | ITC of Rs.300 will form part of Expense Incurred in the books and also such ITC can’t be included in ITC as per GSTR 3B, even if reported in GSTR 2B. | |
| Total June Month | 1,300 | 1,100 | 800 | ||
| Sr. No. | Scenario | IGST ITC as per | ITC for GSTR 3B | Author’s Remarks | |
| Books | GSTR 2B | ||||
| 6 | Few Invoices not posted in books and reflected in GSTR 2B, but ITC ineligible as per section 17(5) / any other section | ||||
| Eligible ITC | 1,000 | 800 | 800 | Eligible ITC of Rs.200 can be claimed once reported in GSTR 2B | |
| Ineligible ITC | – | 300 | – | ITC of Rs.300 will form part of Expense Incurred in the books and also such ITC can’t be included in ITC as per GSTR 3B, even if reported in GSTR 2B. | |
| Total June Month | 1,000 | 1,100 | 800 | Invoice Level matching of Invoices as per GSTR 2B with Invoices as per books should be done mandatorily, otherwise aggregate matching of Books (1,000) with GSTR 2B (1,100) would show ITC as per GSTR 2B on higher side. Ignorantly prima-facie matching might result in excess availment of ITC in GSTR 3B | |
| 7 | Purchase related Credit Notes as per books matches with GSTR 2B of the same month | ||||
| June Month | (1,000) | (1,000) | (1,000) | Credit Notes should be reported separately in GSTR 3B and should not be netted off from eligible ITC. | |
| 8 | Few Purchase related Credit Notes as per books, but not reported in GSTR 2B | ||||
| June Month | (1,000) | (600) | (1,000) | Since you can’t claim ITC more than eligible amount, Credit Notes should be reported in same month’s GSTR 3B in which they have been raised, even if not reported in GSTR 2B or reported subsequently. | |
| 9 | Few Purchase related Credit Notes as per books, but not reported in same month GSTR 2B and reported subsequently | ||||
| June Month | (1,000) | (800) | (1,000) | Since you can’t claim ITC more than eligible amount, Credit Notes should be reported in same month’s GSTR 3B in which they have been raised, even if not reported in GSTR 2B or reported subsequently. | |
| July Month | (1,500) | (1,700) | (1,500) | GSTR 2B of July month includes Credit Note of Rs.200, not reported previously in GSTR 2B. Since you have already reversed such ITC in June Month GSTR 3B, now only July month’s credit notes to be reported | |
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| Sr. No. | Scenario | IGST ITC as per | ITC for GSTR 3B | Author’s Remarks | |
| Books | GSTR 2B | ||||
| 10 | Few Purchase related Credit Notes not posted in books, but being reflected in GSTR 2B | ||||
| June Month | (800) | (1,000) | (1,000) | Kindly ensure to get original credit note from your vendor and post in your books. | |
| 11 | Invoices being reported in GSTR 2B with RCM Flag as ‘Yes’ | ||||
| Regular Invoices | 1,000 | 800 | 800 | ITC of Rs.200 can be claimed once reported in GSTR 2B | |
| RCM Invoices | – | 50 | 50 | RCM Output Tax as well as Input Tax to be reported in appropriate table of GSTR 3B and should not be clubbed in any other ITC. | |
| Total June Month | 1,000 | 850 | 850 | Invoice Level matching of Invoices as per GSTR 2B with Invoices as per books should be done mandatorily, otherwise aggregate matching of Books (1,000) with GSTR 2B (850) would show regular ITC as per GSTR 2B on higher side than eligible ITC (800). Ignorantly prima-facie matching might result in excess availment of ITC in GSTR 3B, without RCM Output Tax being deposited | |
| 12 | Credit Notes as per GSTR 2B in relation to Ineligible ITC u/s.17(5)/any other section | ||||
| June Month | – | (500) | – | Since Credit note relates to ineligible ITC , which was never claimed in GSTR 3B, Hence such Credit Note should be ignored, even if reported in GSTR 2B | |
Few points to be kept in mind while preparing reconciliation of GSTR 2B with books of accounts
Reconciliation of GSTR 2B with books of accounts should be mandatorily done before filing of GSTR 3B and always kept in record. There might be other conditions and restrictions for availment & reversal of ITC as per provisions of GST Law, however this article is solely based on reconciliation with GSTR 2B with books. Hence other provisions of law should also be kept in mind.
In the following chart, we have highlighted few points to be considered while preparing reconciliation of GSTR 2B with Books of accounts for the purpose of filing of GSTR 3B. Since Filing of GSTR 3B is monthly exercise and GSTR 2B is also generated on monthly intervals, it is always recommended to prepare reconciliation with books of accounts to aviod any notices from GST department in case of any mismatch.
Excess availment of ITC might result in payment of Interest & penalty to Government and short/less availment of ITC might result in loss to the taxpayer as eligible ITC could not be claimed within prescribed timeline as per provisions of GST Law. Hence proper reconciliations should be done before filing the GST Returns.
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Article contributed by: CA. Sagar Gambhir | FCA, DISA (ICAI), DIRM (ICAI), B.COM | [email protected]
Author can be reached at [email protected] for any queries, issues & recommendations relating to article. Any feedback for improvement would be really appreciated.
Disclaimer: The contents of this article are for information purposes only and does not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up. The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.
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how to pass all this entry please help
Sir, Good Morning. I have just gone through your article in TAX GURU and found it to be highly informative and educational as well. Please let me know that if we meet all the requirements from Sl. NO. 1 to 3 i.e we have original invoice, posted in books of account and ITC is eligible and admissible as per GST Law but the same is not posted in GSTR 2B but reflected 2A. What should be the action on part of the registered taxpayer, when he is not at all fault. One of our supplier has uploaded or filed GSTR 1 for the past period now only as per amnesty scheme. Whereas we had taken credit his invoices long back.
Now suppose we take our credit only in accordance with the provisions of GSTR 3 B and GSTR 2 B but our supplier uploads his GSTR 1 after payment of late fee and fine after September of the succeeding financial year, in that case recipient will loose his eligible and admissible credit . I am of the view that we should take credit and wait for the notice rather than loosing the credit out rightly. Moreover, in number of case various high court have categorically held that recipient can not held guilty for the actions of supplier, if complete payment towards the tax invoice has already been by the recipient.