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2018

Steps to be taken while filing GSTR-3B/GSTR-1

Steps to be taken while filing GSTR 3B2FGSTR 1 1

It is critically important to verify the details to be uploaded in GSTR 1 and 3B. Details of outward & inward supplies as well as available ITC must be cross verified to determine net tax liability for the month. As the due date of GSTR 3B is approaching fast, it is relevant to discuss all the points which are essential for an accountant and tax consultant before filing GST Returns.

1. Eligible Input Tax Credit for the Month:

If a registered dealer has failed to avail input tax credit for any invoice pertaining to the period from July 2017 to March 2018, such ITC can be availed till the earliest of the following dates:

A. On or before the due date of furnishing the return for the month of September 2018 i.e. 20-10-2018.

OR

B. Before filing of annual return for July 2017 to March 2018.

Hence, the entity is advised to avail the pending ITC pertaining to invoices raised in July 2017 to March 2018 by the vendor within the due date of filing the return of September 2018.

2. Reconciliation of ITC:

  1. Reconciliation of ITC between GSTR 3B and Books of Accounts:The ITC as reflected in GSTR-3B must match with the ITC as shown in the books of accounts. Due to human error or system errors, ITC may not be available in GSTR 3B. Such errors must be rectified to avail right amount of ITC.
  2. Comparing GSTR 3B with GSTR 2A:ITC claimed in GSTR 3B must be matched with ITC reflected in GSTR-2A. We must make sure that our vendors have mentioned our GST details are properly in their GSTR - 1. Sometimes it can also happen that an ITC amount is reflected in GSTR - 2A but is not available in our GSTR - 3B.
  3. Reasons for Mismatch between GSTR 3B and GSTR 2A:
  • There may be cases where vendor has sent the invoice which the company has not received at all. In such cases, the company is required to follow up with the vendor and get the invoices and then avail ITC within the time prescribed above.
  • In many cases, ITC on bank charges have not been taken as invoice may not be received from Bank. In such cases, the company is required to follow up with the bank and get the invoices and then avail ITC within the time prescribed above.
  • There have been instances where GSTIN number was not provided to the vendors initially resulting in issuance of invoice as B2C.
  • In such cases, the company must get the invoices amended from the vendor as B2B before availing the ITC and assure that the vendor rectifies the same in his GSTR-1 not later than GSTR-1 for the month of September’2018.
  • There may be instances where the goods have been received in 2017-18 but the same has not yet been cleared by the quality & inspection department and thus the purchases have not yet been booked.
  • In such case, the quality & inspection department must take place immediately so that the ITC can be availed within the time frame.
  • A reconciliation between ITC as per GSTR-2A and as per books will reveal such differences (if any). Hence, such activity may be carried out to avail credit at the time of filing September 2018 return within the due date.


3. ITC Distributed by ISD:

All the recipient units are required to avail the ISD credit based on the invoices issued by ISD. It is advised that all such ITC distributed on ISD invoices issued in July 2017 to March 2018, shall be availed on or before due date of Sept 2018 return.

4. Debit Notes Issued:

  • Sometimes a Debit note is issued during FY 2018-19. However it may be issued in respect of an invoice issued in 2017-18. Hence, ITC needs to be availed in respect of such debit note as well.
  • As per section 16(4) of Central Goods and Services Tax Act, ITC on debit note issued by vendor during the current year i.e. 2018-19 which is pertaining to invoices raised in 2017-18 has to be availed before due date of filing of annual return OR before due date of filing GSTR-3B for the month of September’18, whichever is earlier.
  • Therefore, the company has to evaluate all the debit notes issued during the period 01-04-2018 to 30-09-2018 pertaining to the original invoices issued during the period 01-07-2017 to 31-03-2018. E.g. ITC on debit note issued by vendor in April’18 against the original invoice pertaining to March’18 has to be availed on or before due date of Sept 2018 return.


5. Error or omission of invoices:

  • If any errors are made while uploading invoices in GSTR-1, and such errors have not be rectified in the subsequent month, it must be rectified before filing GSTR-1 for the month of September OR before filing annual return, whichever is earlier.
  • Similarly, the invoices which have been missed in GSTR-1 for July’17 to March’18 can be uploaded in GSTR-1 of September 2018. Further corrections in GSTR-3B should also be done till the return of September 2018.

 

6. Credit Notes:


We must make sure that credit notes for the period 1st July 2017 to 31st March 2018 have to be issued & uploaded in GSTR-1 before filing annual return OR before filing GSTR-1 for the month of September, whichever is earlier. If such credit notes are not uploaded on or before filing GSTR-1, then the liability cannot be reduced to that extent.

7. GST paid on RCM on behalf of ISD:

  • RCM liability cannot be discharged by an ISD. Hence, the same must be paid under a normal registration in the state in which ISD is registered.
  • Thereafter, an invoice must be raised on ISD as per rule 54 (1A) for common input services so that the same can be distributed to distinct persons at the earliest. It is advisable that the invoice shall be raised on ISD in the month in which ITC is availed under the normal registration.

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