In 2020, more than 12,000 businesses in India were fined for errors in their GSTR 9C filings alone. This statistic serves as a stark reminder of the critical importance of accurately understanding and filing this audit report.
GSTR 9C is a mandatory reconciliation statement for businesses with a turnover exceeding ₹5 crore, ensuring that the information provided in GST returns aligns with the financial records of the company. Given its significance in maintaining compliance with tax regulations, businesses need to understand the format, due date, and turnover limits for GSTR 9C.
In this blog, we will cover all the essential aspects of GSTR 9C, including its format, due dates, and turnover thresholds, to help businesses file accurately and stay compliant.
Understanding GSTR 9C: Applicability and Exemptions
GSTR 9C aligns the GSTR annual returns of a fiscal year with the figures from a taxpayer’s audited financial report. Introduced on 13th September 2018, this statement ensures that any discrepancies between the GST returns and financial records are identified and addressed. It compares the details reported in GSTR 9 with a taxpayer’s audited financial statements.
As per GST Rule 80 and CBIC Notification no. 30/2021 dated 30th July 2021, registered taxpayers under GST whose turnover exceeds the prescribed threshold of Rs. 5 crore in a financial year are required to file GSTRCBIC notification no. 30/2021 9C. Additionally, foreign airlines compliant with the provisions of the Companies Act 2013 are exempt from this requirement, as stated in CBIC Notification no. 09/2020 dated 16th March 2020.
Moreover, non-resident taxpayers providing OIDAR services in India to unregistered individuals are also exempt from filing both GSTR-9 and GSTR 9C, as per CBIC Notification no. 30/2019 dated 28th June 2019.
With a clear understanding of the applicability and exemptions related to GSTR 9C, let’s now explore the specific deadlines for filing to avoid penalties.
GSTR 9C Filing Deadlines
Timely filing of GSTR 9C is crucial to avoid penalties and maintain compliance. The due date for filing GSTR 9C is the same as the deadline for submitting the Annual Return in GSTR-9. Therefore, GSTR 9C must be filed by December 31st of the year following the relevant financial year under audit. The government may extend the due date if necessary. For example, the deadline for filing GSTR 9C for FY 2023-24 was December 31, 2024.
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In order to ensure a smooth transition from the deadlines of GSTR 9C filing to its format, it’s essential to understand the structure of the GSTR 9C form and how the reconciliation process plays a pivotal role in achieving compliance within the prescribed timelines.
GSTR 9C Format
The GSTR 9C form consists of two primary sections: Part A – Reconciliation Statement and Part B – Certification by a Chartered Accountant (CA) or Cost Accountant (CMA). Below is a breakdown of each section:
Part A: Reconciliation Statement
This section details the process of reconciling the information provided in the GST returns with the audited financial statements. It includes the following parts:
- Part 1: Basic Details – Includes financial year, GSTIN, and legal/trade name of the business.
- Part 2: Reconciliation of Turnover – Compares gross and taxable turnover as per GST returns with audited books.
- Part 3: Reconciliation of Tax Paid – Aligns tax paid in GST returns with the tax payable in financial statements.
- Part 4: Reconciliation of ITC – Ensure that the ITC claimed in the GST returns is consistent with the audited financial statements.
- Part 5: Additional Liability due to Non-reconciliation – Highlights any discrepancies and auditor’s recommendations.
Part B: Certification
This section is completed by a CA or CMA, who certifies the accuracy of the Reconciliation Statement. The CA or CMA also provides an audit opinion on the financial statements, confirming that they are in accordance with applicable laws and regulations.
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Having explored the GSTR 9C format in detail, the next step is to understand the filing process to ensure accurate and timely compliance.
Preparation for Filing GSTR 9C: Key Steps Before Submission
Filing GSTR 9C requires adherence to a structured process to ensure compliance. Below are the essential steps involved:
1. Filing of GSTR 9 Form
Before submitting GSTR 9C, the taxpayer must file the GSTR 9 annual return for the relevant financial year. This step is essential to provide a comprehensive summary of the taxpayer’s GST transactions, including outward supplies, inward supplies, and taxes paid.
2. Preparation and Self-Certification
The taxpayer is responsible for preparing the GSTR 9C form and certifying it themselves. The form includes the reconciliation of turnover, taxes paid, and other GST-related details.
3. Submission Along with Audited Financial Documents
The taxpayer must submit the GSTR 9C form along with the audited annual accounts and financial documents. This includes the balance sheet, profit and loss statement, and other relevant documents to verify the accuracy of the GST returns.
After fulfilling all the necessary requirements to file GSTR 9C, the next phase involves accessing the GST Portal for a seamless filing experience. Let’s now take a closer look at the detailed process of filing GSTR 9C on the official GST website.
Steps to File GSTR 9C on the GST Portal
Filing GSTR 9C on the GST portal involves a series of steps:
Step 1: Log in to the GST Portal
Visit the official GST Portal and log in using your GSTIN and password.
Step 2: Access the ‘Annual Return’ Section
Once logged in, go to the “Services” tab on the homepage and select “Returns” from the dropdown menu.
Step 3: Select ‘Annual Return’ and Financial Year
After accessing the “Returns” section, choose “Annual Return”. Select the relevant financial year for which you are filing GSTR 9C, as the form needs to be filed annually for each financial year.
Step 4: File GSTR 9
Before filing GSTR 9C, ensure that the GSTR 9 annual return has been filed successfully for the chosen financial year. GSTR 9C can only be filed after GSTR 9 is submitted.
Step 5: Select the ‘GSTR 9C’ Form and Fill in the Reconciliation Details
Once GSTR 9 is filed, navigate back to the “Returns” menu and select the “GSTR 9C” form. In this form, enter the necessary reconciliation details, including turnover, taxes paid, tax payable, and any adjustments. Additionally, include audit and reconciliation data to ensure accuracy and compliance.
Step 6: Upload Audited Financial Statements
Attach the audited financial statements, including the balance sheet, profit and loss account, and any other necessary documents. Ensure that the taxpayer self-certifies these documents to confirm their accuracy and compliance.
Step 7: Review, Verify, and Submit the Form
Review all the information entered in GSTR 9C carefully to ensure its accuracy. Cross-check the details with the audited accounts and GSTR 9 return to avoid discrepancies. After verifying the details, click on the “Submit” button to file the form. This will complete the filing process for GSTR 9C.
Step 8: Acknowledge Submission
Once the form is successfully submitted, the GST portal will generate an Acknowledgment Receipt. Save this receipt for your records.
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In order to ensure a smooth filing process, it’s essential to be aware of the recent changes and updates in GSTR 9C that may impact how you complete the reconciliation and filing steps.
Changes and Updates in GSTR 9C
The recent changes in GSTR 9C include the removal of the requirement for certification by a CA or CMA for certain taxpayers. This update allows registered taxpayers to perform their reconciliation without the mandatory certification for those under the specified turnover threshold. The removal streamlines the process for smaller businesses while still ensuring that larger businesses with a turnover exceeding Rs. 5 crores must comply with the certification requirement.
In addition, significant changes have been made to the tables and formats within GSTR 9C. The revised format facilitates easier reconciliation by allowing registered taxpayers to verify and input data directly, enhancing the accuracy and efficiency of the filing process. These changes simplify the reporting process, especially for businesses that rely on their own internal records and accounting systems, reducing the dependency on external professionals for verification.
Accurately filing GSTR 9C and staying updated on regulatory changes can be challenging and time-consuming. Let’s explore how Pazy ensures seamless compliance by automating the filling process.
Pazy’s Automation Simplifies GSTR 9C Filing
Pazy is a comprehensive GST compliance solution that streamlines GSTR 9C filing. Its advanced automation features simplifies the entire process, ensuring accurate reconciliation between financial records and GST returns. With auto-reconciliations occurring three times a day, Pazy enhances tax compliance efficiency, reduces manual efforts, and improves overall accuracy in the filing process.
- 2A/2B GST Reconciliation
Pazy ensures that GST returns match with the data in GSTR-2A and 2B, preventing mismatches and ensuring accurate credit claims.
- Reduced Tax Leakage
By automating GST reconciliations and identifying discrepancies early, Pazy helps businesses capture the full tax credit, minimizing tax leakage.
- Real-Time Error Alerts
The system provides instant alerts for discrepancies, allowing businesses to address issues promptly and ensure compliance.
Pazy provides customized solutions to meet diverse business needs. It simplifies GST management for small to medium-sized businesses, automates reconciliation for finance teams, and ensures sector-specific compliance. For entrepreneurs and startups, Pazy offers cost-effective tools to streamline compliance and maintain tax accuracy.
Conclusion
GSTR 9C is a vital compliance requirement for businesses with an annual turnover exceeding Rs. 5 crore. This reconciliation statement ensures accuracy between GST returns and audited financial statements, preventing discrepancies and potential penalties.
By adopting tools like Pazy, businesses can streamline the process effortlessly. Pazy’s expert solutions provide automated reconciliation, real-time compliance tracking, and professional advisory, ensuring accurate and timely GSTR9C filing.Optimize your GST filing process with Pazy‘s end-to-end tax compliance solutions. Schedule a Free Demo today to see how our tools can simplify your GSTR 9C filling and ensure accurate tax reconciliation.
FAQs
1. Can GSTR 9C be revised after submission?
GSTR 9C cannot be revised after submission. However, if there are errors, a revised return can be filed for the subsequent financial year.
2. How is the turnover calculated for filing GSTR 9C?
Turnover is calculated based on the total taxable supplies made by the taxpayer, including exports, exempted goods, and inter-state supplies, among others.
3. Can GSTR 9C be filed without an audit?
No, the GST audit must be completed before filing GSTR 9C. The reconciliation statement requires certification from a Chartered Accountant or Cost Accountant, which must be obtained before submission.
4. What is the difference between GSTR 9 and GSTR 9C?
GSTR 9 is the annual return, while GSTR 9C is the reconciliation statement, certified by a CA or CMA, ensuring that the returns match the audited financial statements.
5. Is it possible to file GSTR 9C with provisional financial statements?
No, GSTR 9C should be filed only with final audited financial statements, as provisional statements may lead to inaccuracies.
6. Can GSTR 9C be filed if the financial year is not closed?
No, GSTR 9C can only be filed after the financial year ends and the audit is completed for that year.
7. Can GSTR 9C be filed without prior approval from the GST department?
Yes, GSTR 9C can be filed directly on the GST portal once the necessary reconciliation and certification by a Chartered Accountant or Cost Accountant are completed.
8. Is GSTR 9C applicable to non-resident taxpayers?
No, non-resident taxpayers are not required to file GSTR 9C, as it applies only to regular taxpayers with a turnover exceeding Rs. 5 crores.
9. What happens if the auditor fails to certify GSTR 9C?
If the auditor fails to certify GSTR 9C, the taxpayer will not be able to submit the reconciliation statement, leading to non-compliance.
10. Can GSTR 9C be filed after the due date with penalties?
Yes, GSTR 9C can be filed after the due date, but penalties and interest will be applicable as per the GST rules.