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Clarification regarding annual returns (FORM GSTR-9 / FORM GSTR-9A) and reconciliation statement (FORM GSTR-9C)

GSTR-9 is the annual return form for normal taxpayers, GSTR-9A is for composition taxpayers, while GSTR-9C is a reconciliation statement. The Union Ministry of Finance has said that businesses need to mention any mismatch in Goods and Services Tax (GST) monthly sales return and outward supply details  in the annual return form and due taxes should be paid.

The queries has been raised asking about whether the primary source of data for the filing of the annual return and the reconciliation statement should be GSTR-1, GSTR-3B or books of accounts.

By keeping in mind the has been resolved by the ministry that Information in Form GSTR-1, GSTR-3B, and books of accounts should be synchronous and the values should match across different forms and the books of accounts. If the same does not match, there can be broadly two scenarios, either tax was not paid to the government or tax was paid in excess.

In the first case, where tax has not been paid and the same shall be declared in the annual return and tax should be paid, and in the latter, all information may be declared in the annual return and refund (if eligible) may be applied through Form GST RFD-01A. Further, no input tax credit can be reversed or availed through the annual return. If taxpayers find themselves liable for reversing any (Input Tax Credit) ITC, they may do the same through Form GST DRC-03 separately.

If a taxpayer has not paid, short paid or has erroneously obtained / been granted a refund or has wrongly availed or utilised ITC then before the service of a notice by any tax authority, the taxpayer may pay the amount of tax with interest. In such cases, no penalty will be levied on such taxpayer.

Therefore, in cases where some information has not been furnished in the statement of outward supplies in Form GSTR-1 or in the regular returns in Form GSTR-3B, such taxpayers may pay the tax with interest through Form GST DRC-03 at any time. The annual return provides an additional opportunity for such taxpayers to declare the summary of supply against which payment of tax is made.

Note: Due date of filing Annual Return (FORM GSTR-9 / FORM GSTR-9A) and Reconciliation Statement (FORM GSTR-9C) is 31st August, 2019.

Author: Niranjan Reddy

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