The Goods and Services Tax (GST) regime in India has transformed the way businesses comply with indirect tax regulations.
Yet, understanding and filing the various GST returns can still feel daunting, especially when it comes to annual forms like GSTR-9 and GSTR-9C.
These forms play an important role in ensuring transparency and accuracy in GST filings. In this blog, we’ll break down what these forms entail, the recent updates you need to know, and how they impact your compliance process.
What is GSTR-9?
GSTR-9 is an annual return that consolidates all GST transactions of a registered taxpayer over a financial year.
It includes a summary of outward supplies, inward supplies, tax liability, and Input Tax Credit (ITC) claimed.
Who Needs to File GSTR-9?
- All taxpayers with a GST registration.
- Composition taxpayers, ISD, TDS, and casual taxable persons are exempt.
Key Components of GSTR-9
- Outward Supplies: Details of sales made during the financial year.
- Inward Supplies: Purchases made and their tax liability.
- ITC Claimed: Credits availed on purchases.
- Tax Paid: Summary of tax payments made.
The deadline to file GSTR-9 is typically December 31 following the financial year.
What is GSTR-9C?
GSTR-9C is a reconciliation statement and self-certified audit report required for taxpayers whose annual turnover exceeds a specified threshold. It compares the data filed in GSTR-9 with the taxpayer’s financial statements to ensure accuracy.
Purpose of GSTR-9C
- Reconcile discrepancies between GST returns and financial records.
- Validate ITC claims and turnover declarations.
Who Needs to File GSTR-9C?
- Taxpayers whose annual revenue exceeds 5 crores.
- Mandatory self-certification by the taxpayer or a Chartered Accountant.
Differences Between GSTR-9 and GSTR-9C
| Aspect | GSTR-9 | GSTR-9C |
|---|---|---|
| Purpose | Annual summary of GST data | Reconciliation with financial books |
| Eligibility | All regular taxpayers | Turnover exceeding ₹5 crores |
| Audit Role | Not applicable | Requires reconciliation statement |
While GSTR-9 summarizes annual data, GSTR-9C ensures accuracy through reconciliation.
New Updates and Changes in GSTR-9 and GSTR-9C
Auto-Population of ITC in GSTR-9
Starting FY 2023-24, the Input Tax Credit details for domestic supplies will be auto-populated in Table 8A of GSTR-9 using GSTR-2B instead of GSTR-2A. This change simplifies ITC reconciliation and reduces manual errors.
Why the Switch to GSTR-2B?
GSTR-2B is a static report generated monthly, providing consistent data for ITC claims. By replacing GSTR-2A, which updates dynamically, the process becomes more predictable and accurate.
Introduction of Validation Utilities
The GST portal has rolled out validation tools to help taxpayers identify mismatches and rectify them before filing.
These updates streamline the filing process and ensure better compliance.
Common Challenges in Filing GSTR-9 and GSTR-9C
- Reconciliation Issues: Discrepancies between GSTR-1, GSTR-3B, and financial books.
- ITC Mismatches: Errors in claiming Input Tax Credit due to incorrect data.
- Turnover Calculations: Misreporting annual turnover, especially for businesses nearing the threshold.
- Missing Invoices: Suppliers failing to upload invoices on time.
Addressing these challenges requires meticulous record-keeping and proactive communication with vendors.
Tips for Filing GSTR-9 and GSTR-9C
- Maintain Accurate Records: Regularly reconcile your GST filings with financial books.
- Leverage Technology: Use automated tools to identify discrepancies and simplify data entry.
- Follow Deadlines: Ensure timely filings to avoid late fees and penalties.
- Stay Updated: Monitor GST notifications and circulars for compliance changes.
You may find this helpful:
- Automate GST reconciliation for GSTR1, GSTR 2A & 2B
- Types of GST Returns in India: Deadlines, Forms & More
FAQs
Who is exempt from filing GSTR-9?
Taxpayers under the composition scheme, ISD, TDS deductors, and casual taxable persons are not required to file GSTR-9.
Can ITC be claimed after filing GSTR-9?
No, ITC claims must be reconciled and finalized before filing GSTR-9.
What happens if there’s a mismatch in GSTR-9C?
Discrepancies in GSTR-9C must be rectified by amending returns or consulting a tax professional to ensure compliance.
What are the penalties for late filing?
Late filing of GSTR-9 attracts a penalty of ₹100 per day under CGST and SGST each, up to a maximum of 0.25% of turnover.
GST Compliance = Keep an Eye Open Every Time
GSTR-9 and GSTR-9C are vital for ensuring accurate GST compliance and avoiding penalties. Recent updates, like auto-populated ITC using GSTR-2B, have simplified the filing process.
By staying proactive and leveraging technology, businesses can make annual return filing a hassle-free experience.
Keep track of GST updates and make sure you’re well-prepared for the upcoming financial year!
