Latest Update on GSTR-9 and GSTR-9C

Budget 2021: Update as on 1st February 2021 GST audit requirement by specific professionals such as CAs and CMAs has been removed from the GST law. Section 35 and 44 were amended for this. As per the amendment, only GSTR-9-annual returns on a self-certification basis needs to be filed on the GST portal by taxpayers, completely removing the requirement for GSTR-9C -reconciliation statement.  However, the financial year and date of applicability of this removal are yet to be clarified by the government. Update as on 30th December 2020 The due date to file GSTR-9 & GSTR-9C for the FY 2019-20 has been extended up to 28th February 2021. Update as on 28th Oct 2020 The due date to file GSTR-9 & GSTR-9C for the FY 2018-19 is further extended up to 31st December 2020.

Q When is GST Audit applicable?

A. GST Audit for FY 2017-18 is applicable to every registered person whose aggregate turnover during a financial year exceeds Rs. 2 Crores. The copy of audited annual accounts and a reconciliation statement is to be furnished while filing GSTR-9C.

Q.What is aggregate turnover?

A: As per section 2(6) of CGST Act, 2017 “aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on a reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number(PAN), to be computed on all India basis but excludes Central tax, State tax, Union territory tax, integrated tax and cess.

For example- Mr. X sells foodgrains of Rs. 1.8 Crore during the year which is exempt from GST. However, Mr. X also supplies jute bags along with foodgrains and charges GST on it separately. His turnover from the sale of jute bags is Rs. 22 Lakhs which is taxable under GST. Thus his taxable turnover is only Rs. 22 Lakhs. But his aggregate turnover amounts to Rs. 2.02 Crores and thus GST Audit is applicable to Mr. X as aggregate turnover includes exempt sales also.

Q: What is the due date for filing GSTR-9C?

A: The due date for filing GSTR-9C for Financial Year is 30 June 2019. For 2018-19, the due date for filing GSTR- 9C Audit Report is 31 Dec 2019 and onwards.

Q: Will the taxpayer be allowed to file GSTR-9C if the taxpayer has not filed an annual return?

A: No, GSTR-9C can be filed only after filing the annual return ie GSTR-9.

Q: What details are to be given in GSTR-9C?

A: On the basis of details to be provided, GSTR-9C can be divided in two parts ie Part A and Part B. In Part A reconciliation of outward supplies and ITC as per audited Annual Financial Statement with details of Annual Return is to be given. Part B deals with certification of GST Audit Report.

Q: What details relating to outward supplies are to be given in GSTR-9C?

A: Reconciliation of turn-over declared in Annual Financial Statements with turn-over declared in Annual Return is to be given in GSTR-9C. The details of reconciliations to be provided are as follows:

a) In Table 5, the reconciliation of gross turn-over is to be given and also reasons in case of unreconciled gross turn-over is to be given in Table 6.

b) In Table 7, the reconciliation of taxable turn-over is to be given and also reasons in case of unreconciled gross turn-over is to be given in Table 8.

c) The reconciliation of rate-wise tax liability is to be provided in Table 9.

Q: What details relating to ITC are to be given in GSTR-9C?

A: Reconciliation of ITC declared in Annual Return with ITC availed in Annual Financial Statements is to be provided. In GSTR-9C, expense head-wise details of ITC availed is also to be provided.

Q: What is the responsibility of GST auditor while furnishing Part B of GSTR-9C?

A: GST Auditor has the responsibility to report about the observations or inconsistencies; if any. The auditor is not only responsible for observations and comments but also in respect of discrepancies and inconsistencies regarding the claim of exemption, classification, valuation, ITC, etc.

Q: What precautions to be taken in filing GST Audit Report?

A: This audit report shall be the first audit report since the implementation of GST. There has been many errors and omission while filing the returns. So, the taxpayer should correctly report the amendments made in  the subsequent financial year. Auditor has crucial role  to play being the first GST Auditor.