GST Annual Return and Audit Service Sector perspective

Agenda Background Legal Provisions Form 9, 9A & 9C in the context of service sector Q & A

Background Reform vs disruption Role of technology Focus on self compliance Legal backing Objective and importance of Annual Return & Reconciliation

Skipped GST Compliance process - then and now Due date Form Nature Who 10th of next month GSTR-1 Invoice wise details for outward supply Supplier 11th of the next month GSTR-2A Invoice wise details of inward supply Recipient- Auto populated on GSTN 15th of next month GSTR- 2 Invoice wise details of inward supply accounted in recipient books Recipient- accept/reject/keep in abeyance or add details to GSTR- 2A 16th of next month GSTR-1A Correction/addition suggested by Recipient in GSTR-2 Supplier- changes proposed by recipient auto populated 17th of next month Accept/reject the changes suggested by the recipient 20th of next month GSTR-3 Monthly return Supplier/Recipient GSTR-3B Summary Monthly return 31st Dec after end of FY GSTR9/9A Annual Return GSTR 9C Reconciliation and Certification by Chartered or Cost Accountant Skipped

Legal Provisions Section 44: Every registered person required to file before 31st Dec an Annual Return in Form GSTR9/ 9A ( composition payer) except -Input service distributor -TCS/TDS payer -Casual taxable payer -Non resident tax payer Section 35 (5) & Section 44 (2)- Before 31st December every registered person having turnover more than Rs 2 Crs is required -to get accounts audited by Chartered/Cost Accountant - submit a reconciliation cum certification in Form GSTR 9C Section 47: late fees of Rs 200 (per day CGST+SGST) and maximum upto 0.5% (CGST+SGST) of the turnover in the State

Prerequisites Consolidation of all GSTR-1 and 3 B returns filed Matching of GSTR 2A with Input credit register Break up inputs- inputs, input services and capital goods Ineligible/blocked ITC and reversals including reclaims TRAN- I and TRAN- II returns filed Amendments, additions, deletions made to previous month returns during current FY and during Apr- Sept 18 HSN code wise – outward and inward supply Breakup of purchases from – composition vendors, for job works and goods received on approval Refunds filed, approved , rejected during July17 - Mar 18

Annual Return GSTR- 9 - decoded Part I- Basic Details - Financial Year, GSTIN etc Part II - Details of outward and inward supply during the FY on which tax is payable - Use GSTR-1 and 3B to populate Table 4 & 5 Part III – Details of ITC declared in return, Table 6 –ITC declared Use GSTR-3B keep breakup of ITC availed into inputs, Input services & capital goods Amount of ITC reclaimed under the Act Keep TRAN-I & TRAN-II returns handy Table 7 – Ineligible and reversed ITC - Break up of ITC reversal due to non payment within 180 days, ISD, exempt/non business supply, reversal on Capital goods and negative list under section 17 (5)

Annual Return GSTR- 9 - decoded Part III – ITC declared in returns Table 8 – Other ITC related Info - Exercise of matching of input credits availed with GSTR 2A must be carried out - ITC availed need to be shown as gross (including availed and then reversed ) - ITC availed on invoices dated on or before 31st Mar 2018 booked during Apr- Sept 18 - Check carefully ITC available but not availed /not eligible - Check IGST paid on import of goods and eligible credits availed. Part IV- Tax paid as declared in return Table 9- Paid through Cash and ITC credit Part V- Transactions of previous FY declared during Apr-Sept 18 Table 10 – 13 - Additions, deletions and amendments Table 14 - Differential tax paid due to 10-13

Annual Return GSTR- 9 - decoded Part VI – Other Information Table 15 - Information about refund applied/ approved ejected Table 16 -Supplies received from Composition supplier, Principal for job work, goods sent on approval but not received. Table 17 - HSN details outward supply Table 18- HSN details Inward supply Table 19 - Late fees payable and paid under Central and State tax

Reconciliation and certification in GSTR – 9C Part I- Basic details Financial year, GSTIN, info about audits carried under any other law Part II – Reco. of TO as per financial statement with annual return Table 5 Reconciliation of Gross Turnover (As per books to GSTR-9) Adjustments due to unbilled revenue, unadjusted tax paid advances deemed supply, Credit notes issued, Forex fluctuations, difference due to valuation Rules etc. Table 6 Reasons for unreconciled difference in Gross TO Table 7 Reconciliation of Taxable TO Need to consider Exempted, Nil rated, non GST, Zero rated supply also supplies on which tax is paid under reverse charge Table 8 – Reasons for unreconciled difference in Taxable TO

Reconciliation and certification in GSTR – 9C Part III- Reconciliation of tax paid Table 9 Reco. of rate wise liability and amount payable, both for forward and reverse charge Interest, late fee, Penalties need to be considered Table 10 Reasons for un-reconciled payment of amount Table 11 Additional Amount payable but not paid Part IV Reconciliation of Input credit Table 12 Reco of net input tax credit ITC of earlier FY claimed in Current FY, ITC booked in current FY to be claimed in Next FY Table 13 Reasons for un-reconciled difference in ITC Table 14 Reco of ITC declared in annual return with eligible ITC under expense heads of audited financial statement Table 15 Reasons for un-reconciled difference in ITC Table 16 Tax Payable on un-reconciled difference in ITC

Reconciliation and certification in GSTR – 9C Part V Auditors recommendations on additional liability On account of outward supply not reported, reverse charge not paid, excess/ineligible ITC claimed, excess refund claimed, interest, penalty, late fees and outstanding demands etc. Part B- Certification Where certification in GSTR 9C and audit of books of account is conducted by same auditor Where certification in GSTR 9C and audit of books of account is not conducted by same auditor

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