15 IMPORTANT POINTS TO BE CONSIDERED FOR GSTR-3B RETURN UNDER GST

Why is it important to file GSTR-3B return?

GST implementation is one of the most revolutionary tax reforms that have ever taken place in India. However, the huge number of returns introduced under the GST regime has left the majority of the taxpayers confused. Well, to make it easy for you, we are here to discuss the very first step in this new regime. Yes, we are referring to GSTR-3B here!

In this guide, we will be discussing all the necessary aspects of GSTR-3B:

Filing the GSTR 3B tax return for the month of September 2018 is critical to take full Input Tax Credit for the tax period 2017-18 in GST. It ensures that all the conditions of the Act and Rules are fulfilled for the same.

GSTR-3B return is a monthly self-declaration that a registered dealer needs to file on goods and service tax portal.For each different GSTIN, you are required to file a separate GSTR-3B. The tax liability is to be paid by the last date of filing the return for the given month. Filing the returns to the Government within the given time is essential for the taxpayer. Furthermore, any delay adds to the interest and penalty rates involved.

Who is required to file returns under GSTR-3B?

Each person who is essentially registered for GST is required to file the GSTR-3B return. This includes all of the nil returns too.

However, the registrants listed below do not have to file the return for GSTR-3B:

• Any non-resident taxable person.
• The suppliers under OIDAR.
• The input service distributors along with composition dealers who has opted for composite scheme.

Companies are advised to fulfill all the requirements to avail the ITC related to the invoices. Thus, it is important for trade and industry to file GSTR-3B return for the month of September 2018 within the stipulated time. This is in order to avoid any additional action that could lead to the reversal of the credit from the department.

Certain activities are to be followed by any company to avail the eligible ITC. Failure to file the required return would lead to the lapse of ITC on the same.

Important Things to remember while filing the GSTR-3B return:

1.Settle the ITC within the books: In cases of stock transfers, you need to reconcile the GSTIN for rectifying any differences before filing the return. If the stocks are transferred at an increased price with a lower price at the branch, ensure the extra credit. You can issue a credit note to the branches in order to reduce the excess credit. The reconciliation of the ITC available in the books along with those availed in the GSTR-3B is essential. Because of human error, there may me scenarios of human or even system error where the ITC was not availed in GSTR-3B. For availing such ITC, it is important to trace back such invoices. The ITC on all the tax invoices should be ensured such as expenses like bank charges and other expenses related to the business. In case you did not claim it yet, you need to do it before filing the return.

2. Verify the stocks on the books with the physical stock: In case stock value as per books of accounts and the stock value as per physical stock are different, you are required to reverse the ITC for the differences. Essentially, the ITC can be availed for the goods and services which were used or at least, intended to be used.

3. In case of multiple registration numbers: Those taxpayer who has multiple GST registrations numbers. such taxpayer needs to ensure that the financial data complies with the total amount of all the states returns in case of ITC, or any outward supplies, etc. If the GST registration numbers do not come in use, then you can surrender them to lower the compliance costs.

4. Transition credit: In case any transition credit comes to play, make sure that you have all the required documents. If you do not have the essential documents, then you have to reverse the same before filing for the return.

5. Stock Transfers: In cases of stock transfers, you need to reconcile the GSTIN for rectifying any differences before filing the return. If the stocks are transferred at an increased price with a lower price at the branch, ensure the extra credit. You can issue a credit note to the branches in order to reduce the excess credit.

6. Input tax credit availed on Prepaid expenses: There may be cases such as annual maintenance contracts, Insurance of stocks etc. where expenses has been belong to partially related to one year and partially related to next year. In such cases ITC shall be accounted for the period which expenses pertain to.

7. Verification of the time of supply for reverse charge transactions: The correct verification of the time of supply for the reverse charge transaction is essential. The different provisions of the time of supply for the reverse charge are to be considered properly, to be accounted for. On the identification of such transactions, it is necessary to pass the accounting entries for the same for a reverse charge.

8. Avail the ISD credit: All the registrants with invoices issued by the ISD are required to avail the ISD credit. The ITC distributed on ISD invoices should be availed by filing the return within the stipulated time.

9. Reverse charge on liability: Under ISD, the reverse charges cannot be discharged. It has to be paid for during the normal registration for the same state where ISD is registered.

10. Debit notes issued during the period of financial year 2018-19 for invoices issues in 2017-18: Vendors are required to adjust the ITC on the debit note issued by the supplier for the current year . This pertains to the invoices raised in the tax period from july 2017 till March 2018. They need to avail this before the due date of filing the GSTR-3B return for the month of September 2018, or even in the filing of the annual return. The due date of annual return is 31st December 2018.

11. Cases of nil returns: In case of no business, nil returns are required to be filed. The GSTN portal offers fast service and procedure to file the return for GSTR-3B. Taxpayers who are filing for nil returns, there is no extensive filing details required. The simple return can be filed with the minimum amount of details. The new functionality does not call for any extra details to be filed.

12. Interest and Penalty: Taxpayers who do not file returns within the given time are subjected to a certain interest rate with a penalty. They are required to pay an additional amount of interest as applicable in relevant provision of GST Act 2017. Essentially, this depends on the number of days that the filing of the return is delayed for. Late payment of tax liabilities as per GST and Non filling of GST returns on due date will lead to prove costly.

13. Reconciliation between monthly GSTR-3B and books of accounts: In order to avoid reconciliation differences between data provided in monthly return in GSTR-3B return forms and annual return to be filled on or before 31st December of relevant financial year, detailed reconciliation statement should be prepared between information file on monthly basis to GST portal and books of accounts. All reconciliation differences can be adjusted in the GSTR-3B for the month of September 2018. The finance ministry did this to help taxpayers undergo a smooth process to file the returns to claim the ITC properly. The differential figures can be reported depending on the net basis under the proper tables for the current month.

14. The date of ITC availed and Date of Capitalization should be same:Evaluate the capital goods to ensure that the date of availing the ITC is same as the date of capitalization of the assets. In case they differ, you need to pass necessary adjustments to reverse the ITC and pay the interests for the GSTR-3B. This also includes the necessary accounting entries.

15. Details required: The taxpayers are not required to provide invoice level details for the filing the return. They need to just fill the total values for each field provided. As businesses have to comply with the GST, invoices and billing system is being made through the GST format.

The above points are important which need to be considered before filing the GSTR-3B return for the month of September 2018. Failure in filing the returns properly can result in credit loss by the business. You need to fulfill and complete all the conditions within the due date, 30th September 2018. Just in case you have not done the required activities during the preparation of financial statements for the year ending on 31st March 2018. The Government has taken various steps to ensure a simplified procedure to file returns. Additionally, the same data can be utilized for filing the returns for GSTR-1.

Utmost care is to be taken to consider all the provisions under the Companies Act, 2013. As this is the first year for the rollout of GST, the GST audit session is not yet notified. Hence, it is important to consider it during the filing of the return for September 2018. 

#GST

source : https://vjmglobal.com/blog/15-important-points-to-be-considered-for-gstr-3b-return-under-gst