September has always been month of reconciliation. In this article we have tried to brief few reconciliations in the form of “Seven things must To Do” in Sept-20 by every GST Return filer!! 20th October, 2020 is approaching soon & every person registered under GST must be aware that 20th October, 2020 ( upto 24th Oct in some cases) is the due date for availing ITC for FY 2019-20. The extract of the section 16(4) of CGST Act, 2017 is reproduced below for reference.

“A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.”

As per the aforesaid provision, the time limit for taking input tax credit for the financial year 2019-20 is up to the filing of GSTR-3B for the month of September 2020. The due date of filing of GSTR-3B for the month of September 2020 is 20/10/2020 ( upto 24th Oct in some cases). Hence any rectification required needs to be done on or before filing GSTR 3B for Sept-20 and GSTR 1 for the month/quarter ending Sept-20. There are so many things to be verified before you can do so and a checklist is summarized as follows:-

1. Reconciliation of ITC claimed in GSTR 3B

ITC for all the invoices for FY 2019-20 needs to be availed through GSTR 3B filed for the month of Apr-2019 to Sept-2020. Hence you need to cross verify the same through Invoices and prepare Easy to remember reconciliation in the following format for future reference- 

GSTR 3B filed for Month: Apr 19 to March 20

Particulars IGST CGST SGST
FY 2019-20 Invoices ITC XX XX XX
Add: FY 2018-19 Invoices ITC availed in FY 2019-20 XX XX XX
Less: FY 2019-20 Invoices ITC Reversal (XX) (XX) (XX)
Less: FY 2018-19 Invoices ITC reversal in FY 2019-20 (XX) (XX) (XX)
Total net ITC claimed as per GSTR 3B for FY 2019-20 XX XX XX

 GSTR 3B filed for Month: Apr-20 to Jul-20

Particulars IGST CGST SGST
FY 2020-21* Invoices ITC XX XX XX
Add: FY 2019-20 Invoices ITC availed in FY 2020-21* XX XX XX
Less: FY 2020-21*Invoices ITC Reversal (XX) (XX) (XX)
Less: FY 2019-20 Invoices ITC Reversal in FY 2020-21* (XX) (XX) (XX)
Total Net ITC claimed as per GSTR 3B for Apr-20 to July-20 XX XX XX
Prepare list of Invoices as per following information
Particulars IGST CGST SGST
Pending ITC to be claimed in GSTR 3B (Aug20/Sept-20) belonging to FY 2019-20 XX XX XX
Pending ITC to be claimed in GSTR 3B (Aug20/Sept-20) belonging to FY 2020-21* XX XX XX

*Apr-20 to July-20 (Presuming GSTR 3B for Aug-20 & Sept-20 is yet to be filed)

2. Reconciliation GSTR 2A with books of Accounts

For the purpose of claiming ITC, the same need to be reflected in GSTR 2A. Hence you need to thoroughly scrutinize the GSTR 2A for FY 2019-20. There may be following issues in respect of GSTR 2A-

  1. Invoice not reflecting in GSTR 2A due to any reason e.g. In GSTR 1 counter party has wrongly mentioned incorrect GSTN, reported that invoice as B2C, reported that invoice as Composition Dealer, not reported that invoice at all, not filed GSTR 1 etc.
  2. Invoice reflecting in GSTR 2A but with wrong details e.g. Wrong Place of Supply (POS) mentioned in GSTR-1, invoice taxable value & taxes head wrong reported etc.
  3. You can prepare reconciliation in following format.
  Particulars  IGST  CGST  SGST  List of Invoices
ITC as per GSTR 3B for FY 2019-20        –         –         – Annexure-1
Less: ITC availed for RCM for FY 2019-20        –         –         – Annexure-2
Adjustments for FY 2018-19
Less: ITC for FY 2018-19 availed in 3B filed for FY 2019-20        –         –         – Annexure-3
Add: ITC for FY 2018-19 reversed in 3B filed for FY 2019-20        –         –         – Annexure-4
Bill as per GSTR 2A, but not in GSTR 3B for FY 2019-20
Add: ITC already availed in GSTR 3B filed till date in FY 20-21        –         –         – Annexure-5
Add: ITC to be availed in next GSTR 3B in FY 20-21        –         –         – Annexure-6
Add: ITC as per GSTR-2A, not to be availed/in-eligible ITC        –         –         – Annexure-7
Adjustments for GSTR 2A
Less: Bills as per GSTR 3B, but not in GSTR 2A for FY 2019-20        –         –         – Annexure-8
Add/Less Any Other Adjustment/Reversal*        –         –         – Annexure-9
*1. CGST SGST taken as IGST
2. ITC availed in 19-20 to be reversed in 20-21
ITC as per GSTR 2A for FY 2019-20        –         –         – Annexure-10

You need to follow up with the respective vendor at the earliest to rectify the same.

One can also use GST Portal Comparison reports for easy reference.

√ Download Comparison of Liability declared & ITC claimed Report for FY 2019-20 : .

Services > Returns > Returns Dashboard > FY 2019-20 : March > Comparison of Liability declared & ITC claimed > View > Click on Refresh Button

√ Download Credit & Liability Statement along with ‘ITC Credit Claimed & Due’ available

3. Reconciliation GSTR 1 with Sales Invoices (More Importantly Exports Invoice)

Reconciliation of GSTR 1 with Sales Invoices also required to be carried down so that all of our B2B customers can get their ITC. Failure to do so may lead to disputes & bad relations with customers. There may be following issues in respect of GSTR 1-

  1. Invoice not reflecting in GSTR 1 due to any reason e.g. In GSTR 1, we may have wrongly mentioned incorrect GSTN, reported that invoice as B2C, reported that invoice as Composition Dealer, not reported that invoice at all.
  1. Invoice reflecting in GSTR 1 but with wrong details e.g. Wrong POS mentioned in GSTR-1, invoice taxable value & taxes head wrong reported etc.
  2. Further you may have filed wrong details of Export Invoice/Shipping Bills, which may lead to failure of Refund application, which need to be amended right now.

Thus need to rectify the same on or before filing GSTR 1 for the month of Sept-20/ quarter ending Sept-20. The same can be rectified through adding invoice in GSTR -1 or amending B2B invoice/Exports Invoices in GSTR-1 as may be applicable.

4. Reconciliation GSTR 1 with GSTR 3B

All the invoices as per books of accounts need to be reported through GSTR 1 & tax to be paid through GSTR 3B. Hence a through reconciliation is required to be done. You may also use GST Portal Comparison reports for easy reference.

√ Download Comparison of Liability declared & ITC claimed Report for FY 2019-20 : .

Services > Returns > Returns Dashboard > FY 2019-20 : March > Comparison of Liability declared & ITC claimed > View > Click on Refresh Button

√ Download Credit & Liability Statement along with 4 Reports available i.e.

  1. Liability other than Export/Reverse Charge
  2. Liability Due to Export and SEZ Supplies
  3. Liability due to Reverse Charge
  4. ITC Credit Claimed & Due

In case Tax paid in GSTR 3B is less that GSTR 1 tax liability, the same need to be reported in next GSTR 3B and Tax need to be paid along with Interest.

5. Ensure filing of GSTR 1 & GSTR 3B for FY 2019-20

In case you have not filed any of the GSTR 1 and/or GSTR 3B for FY 2019-20, then don’t wait now. File the same at the earliest to avoid the adverse implications. Further Late Fees waiver/reduction is also available till 30-Sept-2020.

6. Rectification of Mistakes while filing GSTR 3B/R1

In case you have committed any mistake while filing GSTR 3B/R1 , then the same need to rectified. There may a case that IGST incorrectly reported as CGST / SGST or vice a versa, Zero Rated Export Sales reported as normal sales or vice a versa, ITC wrongly shown in any other head instead of correct head in GSTR 3B.  Then it is the time to rectify the same at the earliest in next GSTR 3B/R1.

Further, you may be having any pending liability of RCM to be discharged for FY 2019-20 or Interest liability for delayed filing of GSTR 3B to be paid, then it would be best to do the same now.

The above reconciliation is not one time exercise, but should be regular one, in order ensure correct & timely tax compliance.

7. Filing of GSTR 9 & 9C for FY 2018-2019

Due date for GSTR 9 & GSTR 9C is also approaching very soon as summarized in the following table.

Readers can refer the following article for detailed discussion of GSTR 9 for FY 2018-19 https://taxguru.in/goods-and-service-tax/faqs-gst-annual-return-gstr-9-fy-2018-19.html 

*****

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.

Article Contributed by:  CA Sagar Gambhir | FCA, DISA (ICAI) | casagargambhir@gmail.com. Author can be reached at casagargambhir@gmail.com for any queries, issues & recommendations relating to article.

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4 Comments

  1. Umakant Gund says:

    Sir I am providing exclusive supply of exmpted product ..That is tarde of milk whether i am liable to take registration if my turn over is exceed rs. 4000000 please suggest
    ..

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