Circular No. ES/ 231 /2018-19 September 28, 2018
To: Members of the Council
Sub: Government notifies GSTR 9, GSTR 9C annual returns forms to curb tax evasion
Synopsis of the Circular
- Last date for filling GSTR 9 & GSTR 9C is 31st December, 2018.
- Tax authorities are relying on these forms to detect tax evasion and fraudulent claims of input tax credit.
- There is no detailed GST monthly returns form to facilitate matching of credit claims.
- GST annual returns form GSTR 9 for normal taxpayers will seek comprehensive details of all inward and outward supplies by a taxpayer to other entities in a financial year, the input tax credit and refunds claimed and the breakup of the taxes paid.
- At present, only a simplified monthly GSTR 3B form and GSTR 1 form is filled by tax payers, and those do not allow for invoice matching by tax authorities.
- Composition dealers with a turnover of upto Rs.1.5 crore and pay a fixed low rate of tax will have to file GSTR 9C for their annual tax returns.
A detailed Note of GSTR 9 & GSTR 9C along with the instructions / guidelines is given below -.
(A) GSTR 9
- Is an annual return Form which is to be filed once in a year by the registered taxpayers under GST including those registered under composition levy scheme.
- Consists of details regarding the supplies made and received during the year under different tax heads i.e. CGST, SGST and IGST.
- Consolidation of the information furnished in the monthly/quarterly returns during the year.
- All the registered taxable persons under GST must file GSTR 9.
- To be filed on or before 31st December of the subsequent financial year. (eg. for FY 2017-18, the due date for filing GSTR 9 is 31st December 2018).
- Late fees will be charged for the late filing of GSTR-9 return.
Different types of return under GSTR 9 :
- GSTR 9 – To be filed by the regular taxpayers filing GSTR 1, GSTR 2, GSTR 3.
- GSTR 9A – To be filed by the persons registered under composition scheme under GST.
- GSTR 9C – To be filed by the taxpayers whose annual turnover exceeds Rs. 2 crores during the financial year. All such taxpayers are also required to get their accounts audited and file a copy of audited annual accounts and reconciliation statement of tax already paid and tax payable as per audited accounts along with GSTR 9C.
- Form GSTR-9 (Annual Return) :
- Preparation of Annual Return is more of compilation of all returns (GSTR-1 & GSTR-3B) with more information.
- Details that are required in addition to the standard monthly returns are as under –
- Inward supplies on which tax is paid under reverse charge mechanism;
- Details of ineligible input tax credit;
- Details of input tax credit as per GSTR 2A;
- Details of any transactions pertaining to 2017-18 reported in GST returns for the period April 2018 to September 2018;
- Differential tax paid during the period from April 2018 to September 2018;
- Details of refund;
- Details of supplies made to composition dealer, deemed supply and goods sent on approval basis;
- HSN-wise summary of inward supplies.
- the Annual returns in GSTR-9 filed for an FY, first being 2017-18 and
- the figures as per Audited Annual Financial statements of the taxpayer.
- To be certified by the CA.
- Can be considered to be similar to that of a tax audit report furnished under the Income tax act.
- Will consist of gross and taxable turnover as per the Books reconciled with the respective figures as per the consolidation of all the GST returns for an FY. Hence, any differences arising from this reconciliation exercise will be reported here along with the reasons for the same.
- The certified statement shall be issued for every GSTIN. Hence, for a PAN there can be several reports of GSTR-9C.
- To be prepared and certified by the Chartered Accountant or Cost Accountant.
- It must be filed on the GST portal or through facilitation centre by the taxpayer along with other documents such as the copy of the Audited Accounts and Annual returns in GSTR-9.
- This statement is applicable to all those taxpayers who must get their Annual Accounts audited under the GST laws. Audit applies to those registered persons whose Annual aggregate turnover exceeds Rs 2 crores in that FY, here being FY 2017-18.
- Due date for submitting the Annual returns in GSTR-9C is the same deadline for submission of GSTR-9. Hence, the GSTR-9C must be filed on or before 31st December of the year subsequent to the relevant FY under audit. For example, for the FY 2017-18, the due date for filing GSTR-9C will be 31st December 2018.
- Any differences between the details reported in all the GST returns and the Audited Accounts must be reported by the CA therein with the reasons for the differences. This statement acts as a base for the GST authorities to verify the correctness of the GST returns filed by the taxpayers. This is because the CA has to certify any additional liability arising out of the reconciliation exercise and GST audit in GSTR-9C.
- Form GSTR-9C: Part – A (Reconciliation Statement)
- Reconciliation of Revenue / Income as per audited books of accounts and outward supplies as per GST return (GSTR 9);
- Reconciliation of taxable turnover with total outward supplies;
- Reconciliation of taxes payable vis-à-vis taxes paid (Auditor is required to exercise his independence and disclose his observations);
- Reconciliation of input tax credit (at expense head wise) from audited financial statement vis-à-vis input tax credit claimed in GST return (GSTR 9).
Since the above exercise would require a robust execution plan on which the auditor needs to work with limited time available at his disposal, it is requested to have a well co-ordinated effort between auditors and auditee (assessees) in terms of information and data sharing enabling auditors to conduct the audit well in time.
Members are requested to read the above contents since it is guide to the subject matter.