GST Audit is a mandatory thing for all those whose turnover crosses the threshold of 2 CR in a year. All these businesses must file GSTR 9C form which is a reconciliation statement that needs to be filed along with filing your Annual Returns. Businesses need to prepare themselves before the audit happens and these are some pointers that might be helpful. This is because the reconciliation statements can have unreconciled amounts even if few invoices have a mismatch. Hence it is better to be prepared for this audit that is an invoice wise reconciliation for an entire year.
Here are the 10 things you must remember while preparing for GST Audit and filing GSTR 9C:
- GST Audit is a comparison of the books of accounts and the sales and purchases as filed on the GSTN via various monthly GST returns filed throughout the year
- Reconciliation statements need to be prepared for turnover, purchases, taxes paid, ITC and any other items like reverse charges, advance taxes paid etc.
- The sales and purchase figures as mentioned in the books of accounts should ideally match the ones filed in GSTR 1, GSTR 3B and GSTR 2A (auto-generated on the GSTN)
- You must prepare proper reconciliation statements for all the differences that arise in the amounts as per books of accounts and those filed on GSTN and these reconciliations should be certified by a qualified CA/CMA
- The reconciliation statement between GSTR 9 and Audited Annual statements needs to be filed on the portal so make sure that these figures are available with you
- To aid the process of actual GST Audit make sure that you have already done an internal audit before by comparing amounts from books of accounts and pseudo GSTR 1, 3B and 2 so that differences are reconciled in time
- The offline utility on the portal has separate sections for each reconciliation statement be it turnover, purchases, ITC, taxes paid, advance taxes paid, reverse charges etc hence make sure that you have all these reconciled in advance
- GSTR 9 Annual returns must be filed before you proceed to prepare your GSTR 9C on the portal as it is mandatory to first file GSTR 9 before you can start filling the offline utility for GSTR 9C
- GSTR 9C cannot be amended and hence make sure that when you file it for the first time you need to be sure that the details are accurate
- You must be prepared with reasons for non-matching of the unreconciled amounts be it turnover – gross and taxable, ITC, taxes paid, reverse charge or advance taxes.
Apart from the above there are many more factors that must be considered before filing the Annual Reconciliation Statement in GSTR 9C. However, this short list can be handy for you when you start preparing for this very important annual activity.