In a recent move implemented by the Finance Ministry, the GST Council has allowed business entities that they can rectify their mistakes in GSTR-3B return form and adjust tax liability without fear of tax penalty. The new move will also help business entities to claim tax credit correctly by making changes in GSTR-3B return form at the time of calculating the GST liability.
Problems have been faced by the business entities in determining correct tax liability since India transitioned into Goods and Services Tax Regime.
Easier compliance provisions and relaxation of norms have been demanded by the industry bodies so that the business entities can easily adopt the new online tax filing system.
According to CBEC, “as a return in Form GSTR-3B does not contain provisions for reporting of differential figures for past month(s), the said figures may be reported on net basis along with the values for current month itself in appropriate tables…”. He further added that, at the time of making some changes in input tax credit or output tax liability, no negative entries will be allowed in GSTR-3B returns.
If any of the taxpayers submitted extra refund by mistake, it can be adjusted in Form of GSTR-3B returns of upcoming months and in some cases when such refund is not possible, a refund may be claimed.
Business entities have to file GSTR-3B returns by 20th date of every month for succeeding month along with the details of paid taxes.
According to a notification issued by CBEC, “Where adjustments have been made in Form GSTR-3B of multiple months, corresponding adjustments in Form GSTR-1 should also preferably be made in the corresponding months.”
Abhishek Jain, Tax Partner at EY India said that the new circular will help business entities, who were facing problems in rectifying changes in GSTR- 3B Returns Form.
According to Rajat Mohan, a partner in AMRG and Associates, earlier in the month of September the CBEC had allowed business entities to make changes in GSTR-3B returns at the time of filing GSTR-1 and GSTR-2 of the similar month.
The CBEC also took some measures to improve the overall procedure in which it is suggested that the figures on net basis along with the values can be reported for the current month as GSTR 3B doesn’t contain provisions for reporting.
According to the new circular, “all rectifications can be made in the same month’s GSTR-3B and GSTR -1”, said Mohan
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