Important things to do before filing GSTR-9 & 9C for FY 2020-21

Important note: The last date of furnishing the GSTR-9 and GSTR-9C forms is 31 December 2021.

GSTR-9 is the GST form that has to be filed yearly through a regular assessee using all the consolidated and combined information pertaining to CGST, SGST, and IGST provided for the year. This also requires complete information of outward liability, Input Tax Credit, Interest, late fees, HSN wise total turnover, HSN wise gross turnover, etc. for the full financial year.

Similarly, GSTR-9C is a reconciliation statement of settlement that undergoes amendments in 2021. Earlier, the GSTR-9C form was applied to the businesses that had a turnover of over 2 crores for one fiscal year. Earlier, it required auditing of books along with the records of a fiscal year while taking the services of a certified management accountant or a chartered accountant. 

Taxpayers with a turnover exceeding Rs. 5 crores in the previous financial year are required to file Form GSTR-9C on a self-certification basis. This change is applicable from FY 20-21 onwards. Further, Form GSTR-9C will be modified to support self-certification by the taxpayer. 

If you want to file the GSTR-9 and GSTR-9C forms for the fiscal year 2020-21, the facility is available on GSTrobo® from the month of August 2021. You can furnish the form before 31st December 2021, which is the last date. 

However, a normal assessee must furnish the significant tasks by the end of October 2021 in order to assure efficient compliance and preciseness. These tasks are mentioned below that must be kept in mind before furnishing GSTR-9 and GSTR-9C. 

Annual GST adjustment for the fiscal year 2020-21

The registered taxpayers need to furnish GST returns on a monthly and quarterly basis. And after the fiscal year is closed, the annual returns must be filed before the 31st of December of the coming fiscal year. It will need the taxpayer to compile the information reported or collected during the financial year. To prevent duplications and declarations furnished, the assessee must sort the information and consolidate the values. If you are a taxpayer, you must not miss the yearly GST adjustment for FY 2020-21. It is also a good idea to use GST tax software to ease the process of filing the forms. 

Changes in GSTR-9 and GSTR-9C 

According to the 6th amendment in the GST rules, which amended the Central Goods & Services Tax or CGST Rules 2017, GSTR-9 (annual return) and GSTR-9C (Statement of Reconciliation) saw a few changes. 

1. There is no need for GSTR-9 for businesses with a turnover of 2 crores or less. 

If you have a turnover of 2 crores or less, you don’t need to furnish the form GSTR-9. For businesses with a turnover of up to 5 crores, they need to submit the form GSTR-9C after self-certifying it. 

2. Both forms are required if the turnover exceeds 5 crores. 

For the businesses that have a turnover of 5 crores or more, it is required to submit both the forms GSTR-9 and GSTR-9C. For the annual compilation of inward supplies, outgoing supplies, input tax credit, and tax liability, GSTR-9 is used. The form must be filed before 31st December of the year following the certain financial year for which the returns are filed. GSTR-9C is a reconciliation statement between the figures filed according to the audited Financial Statements and the form GSTR-9 filed for the FY. 

Rectify the errors and put out the missed invoices 

Before filing the GSTR-9 and GSTR-9C for the financial year 2020-2021, you must rectify the errors and report the lost invoices and credit or debit notes (CDN). You cannot revise information either in GSTR-9 or GSTR-9C. Only additional liability can be paid through GSTR-9 and reconciliation is done in GSTR-9C. There is a set of amendments that you must know- B2B amendments, Credit/ Debit Notes (Registered) Amendments, B2C Large Amendments, Credit Debit Note (Unregistered) Amendments, and Export Invoices Amendments. 

Verify from the vendor, and impact on ITC and Liability

For different reasons, there can be mismatches in the filed forms. For instance, there might be a vendor who declares the liability but does not avail credit in the GST returns, and those credits must be availed at the earliest possible due date of annual returns or September returns. 

Another instance can be that the vendor does not declare his liability on supplies that he has made, but other businesses or organizations have taken credit on purchases in the GST returns. In such cases, businesses or organizations must check it with the vendor to make sure that they declare the liability. Otherwise, there can be a risk of credits not being allowed. 

There can be a mismatch between the credit availed and the liability mentioned by the vendor. In these cases, the causes for differences must be recognized and reconciled properly, maybe by issuing credit or debit notes, etc, while filing the annual returns under section 39 prior to the end of the financial year for which the certain invoice pertains. 

You shall make sure that you cross-check the documents from the vendor and report the missed-out Input Tax Credit or ITC for FY 2020-21. There is various GST return filing software such as GSTrobo® that can help the taxpayers save the headache from all this documentation. 

The credentials that are missing must be confirmed from the individual suppliers or vendors for timely reporting before their respective filing of GSTR-1. Otherwise, the assessee risks losing the ITC or Input Tax Credit for the concerned fiscal year, and he/ she might be unable to avail it while filing the GSTR-3B form every time. 

Difference between GSTR-9C Audited form and draft GSTR-9 form

The assessee needs to settle the reported numbers in the GSTR-9 form and audited financial statements for GSTIN. If there are any numbers that are not matched, they shall be mentioned as unsettled ITC, sales, and tax liabilities in GSTR-9C, which is a self-certified reconciliation statement. In case the tax is still due even after the GSTR-3B form is filed for September 2021, then you can use the GST DRC-03 form to pay the pending tax dues.

To file the documents in a proper format, you might need help from a CA or a great GST return software like GSTrobo®that can ease out the entire process for you. To conclude, it is important to be highly punctual about furnishing your forms so that you don’t face any issues or penalties later.