Key points for first ever filing of GST Annual returns
December, 06th 2018
The Central Board of Indirect tax and Customs (CBIC) has issued the format of annual returns under the Goods and Service Tax (GST). The Taxpayers have to file their first GST annual returns pertaining to the Financial Year 2017-18 by December 31, 2018.
The government has introduced different types of annual return keeping in mind the various categories of taxpayers. For instance, GSTR-9 for regular taxpayers and GSTR-9A for composition scheme taxpayers have been issued. All the taxpayers registered under GST except input service distributors, casual taxable persons, non-resident taxable persons and persons liable to deduct tax at source, and are required to file the annual returns.
Here are some key points one must keep in mind before filing the annual returns for the FY 2017-18:
1. Reconciliation of the books of accounts and tax invoices are issued during July 2017 to Mar 2018 is of utmost importance; this should match the turnover declared in the audited financial statements. It is important for the figures in the books of accounts and the invoices to match or else the GST paid will be incorrect. Along with the invoices, debit and credit notes shall also be in agreement with books of accounts.
2. Stock transfer between the units/branches of the company should be matched with the books of accounts to avoid any discrepancy in the stock-in-hand balance of the books and that of the GST data.
3. Matching of e-way bill data with the tax invoices issued during the period is also very necessary. The e-way bill data state-wise should be carefully mapped with the invoices to keep track of the goods transported and GST paid thereon.
4. Taxpayers should ensure that all the purchase & other service invoices are accounted for in the books of accounts and input tax credit has been duly availed. Any disparity between the input tax credit claimed and tax paid on purchases will result in an incorrect claim of ITC in GST returns.
5. Once the purchase invoices are in agreement with the books of accounts, the taxpayers should ensure that the purchase data is duly uploaded by the suppliers; this data will be reflected in the GSTR-2A form.
6. Before going forward with filing the annual returns, the taxpayers should reconcile all the monthly or quarterly GST returns with the books of accounts. The taxable, exempted and non-GST turnover should be carefully matched. Any difference should be immediately corrected.
7. Ensure that the invoices on which input tax credit has been claimed should be paid within 180 days to the suppliers. If not, the credit availed on the same will be reversed and the taxpayers will be liable to pay such amount along with the interest and penalty if any.
8. While reconciliation the GST paid by electronic cash or credit ledger, the taxpayers should also account for GST paid under Reverse Charge Mechanism (RCM) on the applicable expenses.
9. Make sure that you follow the tips mentioned above, before the December 31, 2018. The rationale behind the filing of the annual return is to consolidate and declare all the information furnished in the monthly or quarterly GST returns during the year.