GST Annual Return & Reco Statmnt

12-01-2022
Annual Return
&
Reconciliation Statement
Simplify GSTR 9 & GSTR 9C Filing CA Venugopal Gella
BENGALURU BRANCH OF SIRC Venu and Vinay
06-01-2022 Chartered Accountants
CA Venugopal Gella venu@vnv.ca
1
12-01-2022
Agenda
Legal Provision
Reporting of Outward Supplies and Tax Liability
Reporting of Input Tax Credit
Reporting of RCM
GSTR-9 Adjustments
Issues
2
12-01-2022
Legal Provision
3
12-01-2022
Annual Return
• Section 44 requires every registered person,
o other than an ISD/ TDS /TCS / CTP / NRTP
o shall furnish an annual return
o which may include a self-certified reconciliation statement, reconciling the value

of supplies declared in the return furnished for the financial year,
o with the audited annual financial statement for every financial year
electronically,
o within such time and in such form and in such manner as may be prescribed.
4
12-01-2022
Annual Return – GSTR-9ABC

Annual Returns
Annual Return
Not Applicable
Registered Person: Composition Dealer

TCS : Rule 80(2) ISD /TDS
Rule 80(1) : Rule 80(1)
GSTR 9 GSTR 9A GSTR 9B CTP /NRTP
GSTR-4 is Annual Return for Composite Dealer. GSTR-9A not available on the portal
5
12-01-2022
Threshold limit for FY 2020-21
Aggregate turnover
Optional to file
> Rs.2 cr
Every Registered Aggregate turnover GSTR 9 is mandatory

Person other than ISD,
> Rs.2 cr but < Rs.5cr GSTR 9C optional
CTP, NRTP, TDS or TCS
Aggregate turnover Both GSTR 9 & 9C

> Rs.5cr mandatory
Due Date for FY 2020-21 is 28th Feb 2022

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12-01-2022
GST Audit Objective
7
12-01-2022
Audit / Department Assessments

Audit Working Papers
Compliance with Law Proper Taxes Paid
Prior Period Adju
Liability = Turnover * Rate of HSN Classification

Tax = Liability - ITC
Tax
Credits to PL
TT = Aggregate Turnover –
Turnover = Taxable turnover Valuation
Exempted Turnover
Time of Supply
ITC = Eligible ITC

Advances
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12-01-2022
Can Annual returns be a source

of correctino
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12-01-2022
Issues
• How to deal with difference in in GSTR 1 and GSTR 3B
o Excess Taxes paid in GSTR 3B.
o Short Taxes paid in GSTR 3B.
o Taxes Correctly paid but Turnover wrongly reported.
o Turnover correctly reported but interchange of taxes between I & C+S.
• New Discovery
o Liability
- Can new taxes be paid thru GSTR 9.
- Excess Payment of Taxes be claimed for Refund
o ITC
- Missed out Input Tax credit can it be availed in GSTR 9.
- Can RTP reverse excess ITC in GSTR 9.
10
12-01-2022
Point to Note
The Annual return is an informative return in which one has to furnish
information for Reporting and cannot be used for :-
a) Payment of Taxes
b) Claiming of Refunds
c) Availment of ITC
d) Reversal of ITC
Payment thru DRC 03 – AR /RC
11
12-01-2022
Reconciliation Statement – GSTR 9C :: 6 Parts 19 Tables

Parts
Part I Part II Part III Part IV Part V
Turnover Tax Payable & Additional

Basic Info Input Tax Credit
Details Paid Liability
Table 1-4 Table 5-8 Table 9-11 Table 12-16
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12-01-2022
GSTR 9C
Audit Prepared Derived 1. 9C is NOT mere compilation of Books /
Returns
Report using From
2. Values to report not as in Books but
Expected as per Law.
GSTR 3B (Done vs Ought to have done)
3. Its an Audit between R9 and Books

GSTR9 GSTR 1 +2 A
9C Adjustments
Audited Books of
Financials Accounts
13
12-01-2022
Annual Return – GSTR 9 :: 6 Parts 19 Tables
Parts
Part I Part II Part III Part IV Part V Part VI
Circular
Input Tax Tax paid 26/2017
Basic Info Liability Other info
Credit details
Adjustments
Table 1-3 Table 4-5 Table 6-8 Table 9 Table 10-14 Table 15-19
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12-01-2022
Freezing of Turnover
15
12-01-2022
Supply can be anywhere
Liability
Asset side Outside
Credit of Debit of side of
of balance financial
P&L P&L balance
sheet statements
sheet
16
12-01-2022
Outward Supplies
• Review of the revenues declared as per books:
o Taxability – Deemed Supplies, Stock Transfers, Cross Charge, Recoveries,
etc – Tata Motors Ltd Advance Ruling No. GUJ/GAAR/R/39/2021
o Classification – Verification of rate + HSN Code
o Valuation – Sale of Vehicles, Discounts/ Incentives, OMV, etc
o Time & Place of Supply, etc
• Review of Debit Notes
o Decrease in tax rate & interest implication
• Review of Credit Notes Issued
o Eligibility, Time Limit for adjustments, shown as ITC, etc
• Tax Treatment in change in rate of tax – Paid on advances @ 28%
17
12-01-2022
Income for books may not be for GST

• Prop
o Rental Income from Immovable Property
o Salary Income
• Partnership
o Introduction of Asset by partner
o Receipt of Asset on dissolution of partnership firm
o Partners’ Salary and Interest
• General
o Discounts/Incentives
o Foreign Exchange Gain
o Profit on Sale of Assets
o Recovery of Baddebts
o Penalty/Damages/Forfeiture
18
12-01-2022
Other Outward Related issues

• Tax related
o Wrong Taxes Discharged
o Taxes short Discharged
o Taxes not discharged
• Supply Related
o Wrong classification
o Zero Rated WOP no LUT
o No Disclosure of NIL/Exempt/Non GST
o INDAS / OCI Adjustments
o Rate / HSN Bifurcation not available
19
12-01-2022
Reconciliation of Books Turnover
Books Turnover
Apr to Mar Stock transfer
GSTIN 1 GSTIN 2 GSTIN 3
20
12-01-2022
Bifurcation of Outward Taxable Supplies

As per Books FY 2020-21 Taxable value IGST CGST SGST Cess
Outward Supply on which Tax is payable
5%
12%
18%
28%....
Outward Supply on which Tax is not
payable
Zero rated
Exempted
Nil rated
Non GST
RCM on outward supply
Total turnover
21
12-01-2022
Freezing ITC
22
12-01-2022
Part III Table 6 ,7 &8
Details of ITC as declared in returns filed

during the financial year
23
12-01-2022
Annual Return – ITC

Input Tax
Credits
Table 6 Table 7 Table 8
Availed as per Reversals as Reconciliation

3B per 3B with 2A
24
12-01-2022
3B Filing – Table 4
(A) ITC Available (whether in full or part)
(1) Import of Goods
(2) Import of Services
(3) Inward supplies liable to reverse charge (other than 1 & 2 above)
(4) Inward supplies from ISD
(5) All other ITC
(B) ITC Reversed
(1) As per rules 42 & 43 of CGST Rules
(2) Others
(C) Net ITC Available (A) – (B)
(D) Ineligible ITC
(1) As per section 17(5)
(2) Others
25
12-01-2022
Comparison
Table Description GSTR 3B
Segregate Total amount of input tax credit availed through FORM GSTR-3B (sum
6A AUTO
as total of Table 4A of FORM GSTR-3B)
Input Inward supplies (other than imports and inward supplies liable to
Capital 6B 4A5
reverse charge but includes services received from SEZs)
Goods Inward supplies received from unregistered persons liable to reverse
Input Service 6C 4A3
charge (other than B above) on which tax is paid & ITC availed
Inward supplies received from registered persons liable to reverse 4A3
6D
charge (other than B above) on which tax is paid and ITC availed 4B*
Segregate 6E Import of goods (including supplies from SEZs) 4A1
as
CGST 6F Import of services (excluding inward supplies from SEZs) 4A2
SGST
6G Input tax credit from received from ISD 4A4
IGST
Cess Amount of ITC reclaimed (other than B above) under the provisions
6H
of the Act
6I Sub-Total (B to H above)
26
12-01-2022
Comparison
Table Description
Difference (I - A above)
6J Actual 3B vs Detailed Reporting ( Result could be Positive, Negative or AUTO
Matching)
6K Transition Credit through TRAN-I (including revisions if any) TRAN
6L Transition Credit through TRAN-II TRAN
6M Any other ITC availed but not specified above eg ITC 01, ITC 02 etc xxx
Sub-total (K to M above)
6N AUTO
Total ITC availed (I + N above)
6O AUTO
Note:
1. 6J is only for reporting
27
12-01-2022
Credit Flow of GSTR 3B into GSTR 9

GSTR 9 GSTR 3B
Forward
6B + 6H 4A5
Charge Credit
Reverse
6C + 6D 4A3
Charge Credit
Matching
Credits
Import of
6E 4A1
Goods
Import of
6F 4A2
Services
6G 4A4 ISD Credit
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12-01-2022
Segregate Expenses into 2 Categories

Expense
analysis
With GST Without GST
Exempt/Non-
Eligible ITC Ineligible ITC RCM
GST
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12-01-2022
ITC Available on the Basis of use
Use of input tax credit
Non-
Taxable Zero-rated Exempt Nil-rated
taxable
Supplies Supplies Supplies Supplies
Supplies
ITC ITC not

ITC Available ITC not available
Available available
Note: Attribution of ITC to be made as per the manner prescribed in the ITC Rules
VnV
CA Venugopal Gella 30 venu@vnv.ca
30
12-01-2022
Time limit
Time limit
(earlier of)
Due date of Date of Filing

Sept return Annual
of next FY returns
31
12-01-2022
Matching of Credits
All inward data
Credit matching with those Credit appearing only in Credit existing only in portal
appearing in the portal books and not in portal and not in books
Check whether the same

No action to be taken credits can be taken as per Missed Accounting;
Rule 36(4) or Invoice based ineligible; not my credit
32
12-01-2022
Reconciliation with GSTR-2A

• All the missed out credit may be availed subject to GSTR-2A.
• Credits appearing in GSTR 2A but not availed in Purchase register/
GSTR-3B:
o Eligibility of such credits should be identified and availed on or before filing the
return for the month of September 2021. Any left out ITC for the period of
2020-21 may be loss to the registered person if not claimed within the due date
of filing GSTR-3B
• Transaction is not reflected in GSTR-2A, follow up may be undertaken.
• Credit Availed onto different GSTN of the same assessess
• Total ITC Avail cannot exceed 105% of the eligible credit appearing in
GSTR-2A
33
12-01-2022
Reversal of ITC
• Instances when ITC to be reversed
o Reversal in case of Availment of Ineligible/ Blocked Credit
o Reversal in case of Non Payment within 180 days
o Actualization of Apportionment of ITC as per Rule 42 & 43 in case of Exempt

Supplies
o Blocked Credits AVaild
34
12-01-2022
SECTION 17(5)- Blocked Credits
Motor vehicles and

conveyances, rent-a- Penalty u/s 74, 129
cab, vessels, aircraft and 130
Non Resident
Food and taxable person
beverages Beauty
treatment,
cosmetic and
Construction and plastic surgery,
works contract
Goods lost, stolen,
destroyed, written off or Personal
disposed of by way of Consumption
gift or free samples Life insurance,
medical
insurance
35
12-01-2022
Errors in ITC Excess Availed

Excess
Availed
Reverse in Correct in Shown as

GSTR 3B GSTR 9 Liability in 3B
After Sept Report in R9 Not

Till Sept 2021
2021 Table 7 Permitted
Claim Refund
Pay thru DRC File DRC 03
Permitted Only DRC 03 of Excess Tax
03 AR for Liability
Paid
36
12-01-2022
Errors in ITC Short Availed

Short
Availed
Avail in Not
GSTR 3B Availed
Till Sept After Sept Credit

2021 2021 Lapse
Restricted Table 8E
Permitted
by 16(4) of GSTR9
37
12-01-2022
ITC Reconciliation with Books
Reversal of ITC
ITC availed for
Net ITC available availed during
the Previous FY ITC as per
(Table 7J of previous FY
(Table 13 of Books
GSTR 9) (Table 12 of
GSTR 9)
GSTR 9)
38
12-01-2022
Issues
39
12-01-2022
Input Tax Credit

• Reconciliation of ITC between Books vs GSTR 3B
• ITC Available in return but not reflected in Form GSTR-2A/2B – [Arise
India Limited Del-HC & Sri Ranganathar Vavles Pvt Ltd Mad-HC]
• ITC on import of goods by filing a Bill of Entry – Time limit u/s 16(4)
Invoice defined u/s 2(66) to cover Tax Invoice as per sec 31
• Credit Availed onto different GSTN of the same assessess
40
12-01-2022
Input Tax Credit

• Impact of ITC reconciliation in table 12 of Form GSTR 9C – whether
leads to any tax liability
• ITC with POS of other States – SGST Credit claimed by a Company
located in Mumbai in which the invoice issued by supplier had
mentioned POS as Rajasthan? Should ITC be reversed?
• Break up of ITC into I/IS/CG – relevance, capitalized, service, ITC
reversal, refund
• Reversal of ITC – exclusive attributable, Common Usage, etc – Rule 42
& 43
41
12-01-2022
Incorrect claim of ITC – Case Study

Mentioned Disclosed in Whether Remarks
on the GST Return rectification
Invoice done in GST
Return
IGST CGST & SGST No Assessee may rectify the error in GSTR- 3B of the current
period & disclosed the details of such rectification in Part V
(table 12 & 13) Further the details of ITC taken as per 3B of
FY 20-21 must be disclosed in table 6 of GSTR 9. Ideally, the
entire situation become revenue neutral.
• Cir No. 26/26/2017-GST dated 29.12.2017 & Bharti Airtel – Delhi High
Court
• Sun Dye Chem v/s The Commissioner of Central Tax (Mad HC) WP No.
29676 of 2019
42
12-01-2022
Freezing RCM
43
12-01-2022
RCM
RCM
Other than
Notified
notified
purchases
Purchases
Sec 9(3) of CGST Section 5(3) of Sec 9(4) of CGST Sec 5(4) of IGST
Act, 2017 IGST Act, 2017 Act, 2017 Act, 2017
44
12-01-2022
RCM – Basic Provisions

Sec 9(3) – Then Sec 9(3) – NOW
• The government a) 20 services are covered
• on the recommendation of the b) Different Implementation
council Dates
• by notification
• specify categories of Supply of
goods or services Refer principal Notification
the tax on which shall be paid by 04/2017 CTR for Goods
the recipient of the goods or
services or both on reverse charge
basis 13/2017 CTR for Services
CA Venugopal Gella 47 venu@vnv.ca
45
12-01-2022
RCM on Notified Service

Sponsorship Service by
GTA Legal Service Arbitral Tribunal
Service CG/SG/LA/UT
Music, Composer,
Insurance/Recover
TDS/ FSI Long Term Lease Director Service photographer,
Agent Service
artist or the like
Members of
Direct Selling Agent of Business
Author Overseeing Business Facilitator
Agent Correspondent
Committee to RBI
Renting of Motor Lending of

Security Service
Vehicle securities service
46
12-01-2022
RCM on Goods
Sl. No. Goods Provider Receiver
1 Cashew Nuts (not shelled or peeled), Agriculturist Any registered person
bidi wrapper leaves (tendu), tobacco
leaves & raw cotton
2 Silk Yarn Any person who manufactures silk Any registered person
yarn from raw silk or silk worm
cocoons
3 Lottery SG, UT or local authority Lottery Distributor or
selling agent
4 Used vehicles, seized and CG, SG, UT or LA Any registered person
confiscated goods, old and used
goods, waste and scrap
5 Priority Sector Lending Certificate Registered Person Recipient who is

registered person
47
12-01-2022
Reconciliation of RCM liability with RCM ITC

RCM
Tax on Inward
Supplies liable to ITC
RCM
Table 4G of
URD RD
GSTR 9
Table 6C of Table 6D of GSTR

GSTR 9 9
48
12-01-2022
Reconciliation of RCM Contd…
Table 6C of Table 6D of Table 4G of

GSTR 9 GSTR 9 GSTR 9
Table 4G of
Table 4 of GSTR 2A GSTR 9
Table 6D of
Table 4 of GSTR 2A GSTR 9
49
12-01-2022
Table 8D : Missing in GSTR 2A Line Items

GSTR 2A Credits
Value of 100 is missing in 2A 8A = 200
Reported in 3B Not Reported

/ECL = 220 3B /ECL = 80
Missed out
Eligible & Ineligible but Availed in Ineligible &
Lapse Taking credit
Availed availed 2021-22 Not availed
in 3B
160 20 40 -20 35 45
8B 8B 8C 8D 8E 8F
52
50
12-01-2022
GSTR 9 Adjustments
51
12-01-2022
Outward Summary
Books Turnover
Tax paid in 3B till Tax paid in 3B till Balance Tax

Mar 2021 Sept 2021 Payable
Table 4 Table 10 & 11 DRC 03
*Provided taxes are paid during that period
52
12-01-2022
Reconciliation of Books Turnover
GSTIN
Wise
Taxable Exempt
Table 4 Table 10* Table 11 Table 5** Table 10 Table 11
*Provided taxes are paid during that period

**Consider actual amount as per Books irrespective of whatever is considered in GSTR 1 and GSTR 3B. As
there is no tax implication, Table 10 and 11 is not applicable
53
12-01-2022
Errors beyond Sept 2021
Payment thru Additional

DRC 03 Liability
Short
Excess ITC Ineligible ITC
Payment of GSTR 9 / 9C
claimed claimed
Taxes
Pay through Pay through Pay through Pay through

Cash/ITC ITC/Cash ITC/Cash Cash
54
12-01-2022
To Check before filing of Returns

• 4 N : Supplies and advances on which tax is to be paid (H + M) above
• 5 N : Total Turnover (including advances) (4N + 5M - 4G above)
• 6 O : Total ITC availed (I + N above)
• 7 J : Net ITC Available for Utilization (6O - 7I)
• 8 D : Difference [A-(B+C)] 2A vs 3B
• 10 & 11 : Supplies / tax declared through Amendments
• 12 : Reversal of ITC availed during previous financial year
• 13 : ITC availed for the previous financial year
• 14 : Differential tax paid on account of declaration in 10 & 11 above
55
12-01-2022
Thank You
For any clarifications
mail to venu@vnv.ca
56

GST Annual Return & Reco Statmnt

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GST Annual Return & Reco Statmnt

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12-01-2022

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

o shall furnish an annual return

o which may include a self-certified reconciliation statement, reconciling the value

CA Venugopal Gella venu@vnv.ca

Annual Return – GSTR-9ABC

Registered Person: Composition Dealer

GSTR 9 GSTR 9A GSTR 9B CTP /NRTP

Threshold limit for FY 2020-21

Every Registered Aggregate turnover GSTR 9 is mandatory

Aggregate turnover Both GSTR 9 & 9C

Due Date for FY 2020-21 is 28th Feb 2022

GST Audit Objective

CA Venugopal Gella venu@vnv.ca

Audit / Department Assessments

Prior Period Adju

Liability = Turnover * Rate of HSN Classification

ITC = Eligible ITC

CA Venugopal Gella venu@vnv.ca

Can Annual returns be a source

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

Payment thru DRC 03 – AR /RC

CA Venugopal Gella venu@vnv.ca

Reconciliation Statement – GSTR 9C :: 6 Parts 19 Tables

Part I Part II Part III Part IV Part V

Turnover Tax Payable & Additional

Table 1-4 Table 5-8 Table 9-11 Table 12-16

CA Venugopal Gella venu@vnv.ca

3. Its an Audit between R9 and Books

CA Venugopal Gella venu@vnv.ca

Annual Return – GSTR 9 :: 6 Parts 19 Tables

Part I Part II Part III Part IV Part V Part VI

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

Supply can be anywhere

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

Income for books may not be for GST

CA Venugopal Gella venu@vnv.ca

Other Outward Related issues

CA Venugopal Gella venu@vnv.ca

Reconciliation of Books Turnover

Apr to Mar Stock transfer

GSTIN 1 GSTIN 2 GSTIN 3

CA Venugopal Gella venu@vnv.ca

Bifurcation of Outward Taxable Supplies

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

Part III Table 6 ,7 &8

Details of ITC as declared in returns filed

CA Venugopal Gella venu@vnv.ca

Annual Return – ITC

Table 6 Table 7 Table 8

Availed as per Reversals as Reconciliation

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

CA Venugopal Gella venu@vnv.ca

Credit Flow of GSTR 3B into GSTR 9

6G 4A4 ISD Credit

CA Venugopal Gella venu@vnv.ca