Last updated on December 2nd, 2022 at 08:23 pm
Annual Aggregate Turnover
Introduction
GSTN portal has implemented a new functionality on annual aggregate turnover. There is no clarity on how the reflection of correct figures of aggregate turnover will benefit the Government or the taxpayer. If it is just for the perusal of the Government then why are taxpayers expected to verify the same and update in case of discrepancy/variation within a stipulated time?
Earlier too there was functionality for AATO that used to show only whether the AATO was above Rs 5 crores or up to Rs 5 crores. But back then the taxpayers were not expected to update or make any changes in the same. The general perception of the earlier functionality amongst the taxpayers was that it was meant for the determination of the frequency of GST returns to be filed by a taxpayer.
Aggregate Turnover [Section 2(6)]
“The aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax, and cess”.
What is the AATO functionality?
This functionality will display the system-calculated actual as well as estimated figures of
- Annual aggregate turnover for the previous year based on returns filed for the previous year.
- Aggregate turnover for the current year based on the returns filed to date for the current year.
It will not only display AATO figures calculated GSTIN-wise but it will also display the cumulative figures of all the GSTIN registered on the same PAN. (Note: If an update is made in one of the GSTINs, PAN-based AATO will be updated for all the GSTINs registered under the same PAN.)
How the system calculates AATO displayed on the dashboard?
The system will calculate the AATO based on the details filed in GSTR-3B for regular taxpayers and based on CMP 08 for composition taxpayers.
- If all the returns in Form GSTR 3B and GST CMP 08 are furnished then AATO will display the aggregate of the same.
- If some of the returns are not furnished then the turnover will be estimated based on the average number of returns required to be furnished and the average number of returns furnished.
Note: A detailed explanation and logic on what basis turnover is calculated and estimated are given along with the advisory.
What are taxpayers expected to do?
Taxpayers are expected to check/verify the system-calculated AATO figures as displayed on the dashboard.
- If the figures match with their records, then no action is required from the taxpayer.
- If the figures do not match with their records, then the taxpayer is expected to update the same within a stipulated time.
Note: An ARN will be generated for every amendment made and the same can be tracked using the service “track application status”.
What happens if you update/edit the turnover to match with your records?
The taxpayer has the option to amend the system-calculated turnover twice after which it will be frozen.
Then Jurisdictional Tax Officer will review
- If within a period of 30 days no action is taken it will be considered as final.
- But if the Officer finds any discrepancy, then the Officer can amend the same after communicating with the taxpayer and it will be considered as final.
Note: As per the advisory, any amendment made will be sent for jurisdictional review. But as per a video update shared by GSTN, when the amendment is more than 20% of the system calculated turnover or when the amendment results in AATO crossing Rs 5 Crores then ONLY it will be sent for jurisdictional review.
Note: Below the table, it is mentioned that final turnover figures will be made available after the tax officer’s verification on 11th October 2021. If the date(11.10.2021) is based on September month’s return in Form GSTR 1 then the GSTN portal has failed to consider the due date of the quarterly return in Form GSTR 1 which is 13th October 2021.
Is there a time limit to amend/update the figures of AATO?
Based on the advisory issued, taxpayers can amend/update the turnover only twice within a period of one month from the rollout of this functionality. So as the functionality was rolled out on 27th July 2021 so taxpayers can update the same up to 27th August 2021.
Note: The option to amend will be frozen before the deadline if the taxpayers amend twice before the deadline.
Unanswered Questions
⊗ Which section, rule, notification, circular, or order empowers the GSTN or Government to seek details of aggregate turnover by this functionality from the taxpayers?
⊗ Why reliance on turnover is based on GSTR 3B and not GSTR 1? There are certain taxpayers who have outward supplies which attract reverse charge so reporting of turnover is done in GSTR 1 but not in GSTR 3B.
⊗ Advisory states the figures will be frozen and considered final. Will these frozen figures have any adverse effect on taxpayers intending to update the turnover by filing the annual return in Form GSTR 9, GSTR 9A, GSTR 9B?
⊗ Will there be any penal consequences if the taxpayer doesn’t verify and update the AATO? If yes under which section the same will be levied?
⊗ In case the taxpayer updates the aggregate turnover, and if any tax is payable the same shall be paid through Form DRC 03?
⊗ It will be a tedious job for taxpayers to figure out if there is any variation as monthly/quarterly breakup of the total turnover is not provided for the benefit of users.
Conclusion
Certainly, the Government would have thought of some benefit or purpose before rolling out this functionality. For taxpayers and Government to work coherently, it would have been better if the purpose behind the implementation of such functionalities which creates an additional compliance burden on taxpayers is revealed.
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She can be contacted at info.financepost@gmail.com
- 50th GST Council Meeting - 11/07/2023
- GST Compliance Calendar of October 2023 - 01/04/2023
- GST sections amended in Finance Act 2023 - 27/03/2023
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Very useful article.
Thanks.
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