This Tax Alert summarizes the recent advisory issued by Goods and Services Tax Network (GSTN) on hard-locking of auto populated values in GSTR-3B.
The highlights of the advisory are:
- GSTN
has improved the GST return filing process by providing a pre-filled
GSTR-3B form with auto-populated tax liability from GSTR-1/ 1A/ invoice
furnishing facility (IFF) and input tax credit (ITC) from GSTR-2B, along
with a detailed pdf report.
- Taxpayers
can now amend incorrect outward supplies in GSTR-1/ IFF through GSTR-1A
before filing GSTR-3B and manage inward supplies for accurate ITC claims
using the Invoice Management System (IMS).
- Starting
tentatively from January 2025, the GST Portal will restrict changes in
auto-populated tax liability in pre-filled GSTR-3B to improve accuracy.
Necessary changes should be made through GSTR-1A.
- However,
locking of auto-populated ITC in GSTR-3B will be implemented after IMS
rollout, with a separate advisory to be issued post addressing IMS-related
issues.
Comments
- IMS
serves as a tool for taxpayers to match their invoices against those
issued by the suppliers, ensuring accuracy in ITC claims. While initially
implemented as a recommendatory measure, in due course the Government
seems to move towards making this process mandatory by introducing a
feature that locks auto-populated data of ITC in GSTR-3B.
- Taxpayers
may examine the legality of this advisory becoming a compulsory practice,
in the absence of any legal provision in this regard.
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