The article elaborates on the guidelines to Accountants in the filing of March 21 GST Returns and getting ready for the upcoming Financial Year 2021-22.
Turnover & Tax Liability
Reconcile the Turnover to be reported as per books April to Feb vs what is present in GSTR 1 and correction to be done in March R1.
It is Generally ignored that ‘Other / Miscellaneous income’+ Profit / Loss on sale of assets + Expenses Reimbursed net off with exp + Interstate stock Transfer + Expense Recovered from employees
Credit Notes: Review Debtors and check if the goods returned are still not accounted for.
RCM Liability : Review all expenses.
There are a few exceptions namely Export Proceeds realization, goods to move out of India within 90 days from export invoice, Job Work Deemed supply if goods sent not received goods Inputs (1year) and Capital Goods (3years) and Review position of goods sent on sale on approval basis (6 months).
Input Tax Credit (ITC)
Reconcile Credit Availed during the year V. available in 2A; Both Missing credit (vendor follow up) and Additional credits(Expenses Accounting)
Adjustments to 2A – Ignore CFS= NO; POS≠LOR; Amendments to Invoice; Credit Note is reduction from ITC.
GSTR 2A vs 2B: 2B will have older credits since its basis GSTR 1 filing date; use only 2A for FY 2020-21 4. Adjust the opening balance value reported in Table 12,13, and 8C of GSTR 9 2019-20 5. Reversal of Credits.
Check ineligible credits availed if any especially 17(5) b) Computation of Rule 42/43 Reversal. RCM availed should match with taxes paid. Payment to the supplier had been made within 180 days.
The ITC availed must be more than or equal to 5% of 2A 36(4) reflecting in GSTR 2A. ITC distribution under ISD has been properly made.
Book Closure Entries
Basis GSTR 3B post journal from Input and output ledgers to Electronic Credit and Liability ledger. Offset the liability ledger along with cash payment. Balance if any in Input / output ledgers to be explained after the above entries. Parking ledgers for GSTR 2A mismatch; Refund to claim; Reversal for Rule 37. Register New Branches / Godown; Issue Self Tax Invoice; Update Aadhar + RC + supply type +Contact Details + Change in Directors /partners in GSTN portal; File ITC 04 Quarterly basis.
Point to remember to get ready for 2020-21
Firstly, new HSN Reporting Limit, 4 digit HSN if in case the Aggregate Turnover equal to or more than 5 Crores and 6Digit HSN where the Aggregate Turnover is less than or equal to 5 Crores.
Secondly, opting into/out of QRMP scheme for Q1 of Financial Year 21- 22 to be done within 30th April 2021
Thirdly, Application for LUT for next year before 31st March.
Fourthly, e-Invoice mandatory where Turnover More than 50 Crores. Fifthly, B2C QR code Mandatory where Turnover is less than 500 Crores. Sixthly, else penalty from December 1, 2020.