GST Annual and Audit Return Face Protest from CA Community

GST Annual Returns and subsequent GST Audit Reports may spoil the record maintenance of several traders. Businesses and taxpayers registered under GST must file GST Annual Returns (GSTR-9 Return) and Audit Reports (GSTR-9C certified by a CA) on or before 31st December 2018. This is for the first time that taxpayers will need to file the return form since GST came into effect in July 2017. However, it seems that not everything is going as per plan and GSTR-9 coupled with GSTR-9C has respectively left both taxpayers worried and Chartered Accountants sleep deprived.

GST Audit and Challenges

On Wednesday, the ICA Bhilai Branch organized a seminar to overcome GST Audit implementation challenges. Piyush Jain, Chairman of the Institute of Chartered Accountants Bhilai Branch, was the key speaker. More than 210 CAs and students of Bhilai branch participated in the seminar. He hailed GST as the biggest economic reforms. But at the same time, he expressed concerns over hurdles and implementation encountered during implementation. Mr. Piyush Jain also discussed GST Audit in details. He particularly stressed to overcome challenges that may arise before Chartered Accountants during GST Audits. He called for a professional approach from the CA community to understand all angles and subtleties associated with GST Annual Return and Audit.

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GSTR-9C was a major topic of discussion during the seminar. The attendees were reprised of the various errors encountered during return filing. In addition to this, details on how to explain causes for differences in GST credit figures were also discussed.

Turnover Interpretation in GST Audit

In the seminar, the speaker CA Sunil P Jain told that as an auditor, a CA should file a report by thoroughly examining all the information. Unlike the previous tax regime, turnover has been interpreted differently under GST. All calculations must be done with utter focus and caution. In case of any discrepancies, the CBDT and IT department can issue a notice in the future. The turnover must also include details of any advance amount received, wrongly claimed credit, penalties against late return filing, interest, wrong quote of tax rates etc. In comparison to Income Tax Audits, the GST Audits are more complex and full of technical glitches. However, unlike other audits, even the smallest of error during GST Audit can invite penalties and cause major headaches for taxpayers and CAs alike.

Bookkeeping for Taxpayers

Former President CA Mahavir Jain told that traders should update the various records, such as sale – purchase register, stock information, tax credit, etc., in line with the GST law. At the same time, all the documents, records, provisions, and formats mentioned in the GST Act should be created and submitted, otherwise, the record of non-record can be placed by the penalty department. Along with the trader/taxpayer, CA must also mention this in the audit report.

Appeal for Extension of the Last Date

The last date for filing GSTR-9 Annual Return and submitting GSTR-9C reconciliation statement is 31st December 2018. But owing to the difficulties in filing the forms, it would be difficult for CAs to meet the deadline. Hence, a written request for extending the last date has been forwarded to the government. In light of the imminent delay, there also has been a for removal or relaxation in penalties in the light of the failure to file and submit GSTR-9 and GSTR-9C respectively before December 31. Reportedly, the current penalty for failure to meet the December 31st deadline ranges from Rs 200 per day to half of total turnover.