In its 31st meeting, the GST Council announced a new year bonanza by extending the FY 2017-18 GST annual return due date to June 30th, 2019. This will only partially benefits taxpayers; however, as there are still many unresolved issues surrounding GST’s audit and annual return process. Taxpayers in India have been tangled up over some of the specific calculations and provisions, and we are highlighting major issues in the light of two crucial milestones of the GST journey.

 

1. Financial Year 2017-18 will now be nine months

 

In form GSTR-9, the annual return form, and GSTR-9C, its reconciliation statement, the term “Financial Year” has been used several times. GST authorities have excluded April ’17 – June ’17 period figures so that FY 2017-18 comprises only nine months (from July ’17 – March ’18).

 

2. Annual returns to be filed with information from GSTR-1 returns

 

Since the inception of GST, GSTR-3B vs. GSTR-1 mismatches has been the primary reason for issuance of departmental notices. The number of mismatches in annual return filings is now likely to increase, as taxpayers are required to file GSTR-9 from information previously filled in GSTR-1 returns.

 

3. No space for amendments or correction of mistakes

 

Many businesses had been expecting a column in GSTR-9 where they could amend or correct information already submitted in the monthly quarterly returns. Much to their disappointment, however, no space has been provided for them to make corrections.

 

4. Splitting the total amount of the input tax credit

 

In Table 6 of GSTR-9, a taxpayer must split up the total amount of their Input Tax Credit (ITC) into inputs, capital goods, and input services. Since this bifurcation was not required in GSTR-3B returns, taxpayers will now have to compute the amounts owed from the accounting records.

 

5. Few things to be considered in respect of output liability

 

1. We need to consider the figures filed in GSTR-3B only and we should not confuse ourselves from the figures entered in GSTR-1

 

2. Turnover as per books and declared in GSTR-3B of 17-18 and 18-19 to be compared

 

3. The turnover of 17-18 disclosed in GSTR-3B of 18-19 to be disclosed in Table 10 and Table 11

 

4. The taxes considered in GSTR-3B of 18-19 on above figures disclosed in Table 10 and Table 11 to be disclosed in Table 14

 

5. Taxes payable on turnover not disclosed in 17-18 and 18-19 should be paid through DRC-03 and there will be same difference in Table 9 between taxes payable and taxes paid auto populated

 

6. Few things to be considered in respect of ITC

 

With the above discussion on the form and its complexity, we should also concentrate few things in respect of Reconciliation of ITC to ease the job –

 

1. Details of ITC pertaining to 17-18 claimed in 18-19 through GSTR-3B needs to be mentioned at 8(C)

 

2. As per the clarification issued, GSTR-2A figure is only indicative and not required to reverse the ITC claimed at the time of filing annual return or audit report

 

3. Out of the figures of GSTR-2A, find the amounts which has not been claim even though eligible and which are inadmissible and enter in 8(E) and 8(F)

 

4. If the difference as above is positive (+), it indicates that the dealer has claimed less ITC than available

 

5. If the difference as above is negative (-), it indicates that the dealer has claimed excess ITC than reported in GSTR-2A and follow-up with dealer and collection of documents to support ITC claim to be carried out, may be, after submission of GSTR-9

 

6. We are not required to go beyond the ITC claimed pertaining to 17-18 in GSTR-3B filed for 17-18 and 18-19 and if ITC as per books is not claimed it cannot be claimed now

 

7. Details of ITC claimed during 17-18 and 18-19 through GSTR-3B only needs to be given irrespective of ITC as per books

 

 

Print