CBIC issues clarification regarding furnishing of information in GST Annual Return and Audit Report
Central Board of Indirect Taxes and Customs (CBIC) has issued Press Release to clarify the issues that the tax payers are facing regarding furnishing of information in Annual Return (FORM GSTR-9 / FORM GSTR-9A) and Reconciliation Statement (FORM GSTR-9C).
Key Points of the Press Release are:
- Tax payers who has not paid, short paid or has erroneously obtained refund or utilized input tax may pay the amount of tax with interest in order to save the penalty before the notice is served to them by filing Form GST DRC-03. Annual return provides additional opportunity to declare the summary of supply against which payment of tax is made.
- It has been clarified that the information filed in GSTR-1(details of outward supplies) and GSTR-3B((summary of all transactions and payments) and books of accounts should be synchronous and the values should match across different forms and the books of accounts. In case of any mismatch due to non payment of tax, the taxpayer should pay the tax and declare the same in the annual return and if the tax was paid in excess then all the information may be declared in annual return and refund(if eligible) may be applied by filing Form GST RFD-01A. Further no input tax can be reversed or availed through the annual return. The tax payers who are liable for reversing any input tax credit then they may do the same through Form GST DRC-03.
- The clarification has been provided regarding input tax credit in Table 8 of the annual return as follows:
- The input tax credit which is declared/computed in Table 8D is basically credit that was available to a taxpayer in his FORM GSTR-2A but was not availed by him between July 2017 to March 2019 and since the deadline has been passed the tax payers cannot avail the credit now. Such credit can also not be lapsed as it was never entered in the electronic credit ledger of any taxpayer and it is just an information needed by the government for settlement purpose.
- The input tax credit which is being reflected in Table 8A of FORM GSTR-9 are auto-populated only for those Form FORM GSTR-1 which were furnished by the corresponding suppliers by the due date. Thus, ITC on supplies made during the financial year 2017-18, if reported beyond the said date by the corresponding supplier, will not get auto-populated in said Table 8A.
- FORM GSTR-2A continues to be auto-populated on the basis of the corresponding FORM GSTR-1 furnished by suppliers even after the due date. In case of any mismatch between the updated FORM GSTR-2A and the auto-populated information in Table 8A, it is to be noted that Table 8A of the annual returns is auto-populated from FORM GSTR-2A as on 1 May, 2019.
- It has been clarified that all IGST paid at the time of imports between July 2017 to March 2019 may be declared in Table 6E of Annual Return and if the the same is done properly by a taxpayer, then Table 8I and 8J of Annual return shall contain information on credit which was available to the taxpayer and the taxpayer chose not to avail the same. Since the deadline has passed, the taxpayer cannot avail such credit now and also there is no question of lapsing of any such credit, since this credit never entered the electronic credit ledger of any taxpayer.
- It has been clarified to the taxpayers that the data that was not explicitly reported in their regular statement/returns (FORM GSTR-1 and FORM GSTR-3B) but are to be reported in Annual returns (Table16A or 18) are only for the information purposes and will not be viewed adversely. In this regard, the taxpayers are advised to declare all such data / details (which are not part of their regular statement/returns) to the best of their knowledge and records.
- It has been clarified that the values that are to be entered in Information in Table 5D (Exempted), Table 5E (Nil Rated) and Table 5F (Non-GST Supply) of the Annual return will not be viewed adversely as there is no tax payable and if there is a reasonable/explainable overlap of information reported across these tables (classifiable as exempted and nil rated). Further it has also been clarified that for the purposes of reporting, non-GST supplies includes supply of alcoholic liquor for human consumption, motor spirit (commonly known as petrol), high speed diesel, aviation turbine fuel, petroleum crude and natural gas and transactions specified in Schedule III of the CGST Act.
- It has been clarified that if the payment of tax on reverse charge basis was made in the FY 2018-19 but the tax was to be paid for FY 2017-18 then the input tax credit will be availed in FY 2018-19 only. Therefore, such details will not be declared in the annual return for the FY 2017-18 and will be declared in the annual return for FY 2018- 19. If there are any variations in the calculation of turnover on account of this adjustment, the same may be reported with reasons in the reconciliation statement (FORM GSTR-9C).
- It has been clarified that the role of chartered accountant or a cost accountant in certifying reconciliation statement will be limited to reconciling the values declared in annual return (FORM GSTR-9) with the audited annual accounts of the taxpayer and not to go beyond that.
- It has been clarified that in determining the turnover for eligibility of filing of reconciliation statement – the aggregate turnover i.e. the turnover of all the registrations having the same Permanent Account Number is to be used. Therefore, if there are two registrations in two different States on the same PAN, say State A (with turnover of Rs. 1.2 Crore) and State B (with turnover of Rs. 1 Crore) they are both required to file reconciliation statements individually for their registrations since their aggregate turnover is greater than Rs. 2 Crore
- It has been clarified that no credit note which has a tax implication can be issued after the month of September 2018 for any supply pertaining to FY 2017-18 however a financial/commercial credit note can be issued. It has been further clarified that credit or debit note for any supply which was issued and declared in returns of FY 2018-19 and the provision for the same has been made in the books of accounts for FY 2017-18, the same shall be declared in Point V of the Form GSTR-9. Also, the debit notes issued during FY 2018-19 and for which the the provision was made in the books of accounts for FY 2017-18 shall be adjusted in Table 5O of FORM GSTR-9C.
- It has clarified regarding Duplication of information in Table 6B and 6H of annual return that the label in Table 6H clearly states that information declared in Table 6H is exclusive of Table 6B and therefore, information of such input tax credit is to be declared in one of the rows only.
- It has been clarified that the Table 14 of the reconciliation statement calls for reconciliation of input tax credit availed on expenses with input tax credit declared in the annual return. It may be noted that only those expenses are to be reconciled where input tax credit has been availed. Further, the list of expenses given in Table 14 is a representative list of heads under which input tax credit may have been availed. Therefore, taxpayer has an option of adding any head of expenses.