Error in GSTR 1 or GSTR 3B correct in GSTR 9
As GST was new for everyone, numerous errors have been made in filing the GST returns for the financial year 2017-18. It was challenging for the taxpayers as well as experts to adapt the new tax regime with changes coming on a regular basis by way of notifications, circulars, orders or press releases, etc.
The taxpayer might have failed to furnish some information relating to the financial year 2017-18 while filing monthly or quarterly returns in FORM GSTR-1 (Statement of outward supplies) or in FORM GSTR-3B (Monthly Summary Statement).
To name a few errors, taxpayers might have
- Missed recording certain outward supplies or recorded a B2B supply as B2C supply or vice versa or
- Have failed to pay tax or tax is short paid or
- The input tax credit has been wrongly availed or wrongly utilized or
- The refund has been erroneously obtained/been granted.
As per section 73 of CGST Act 2017, If the errors were genuinely due to mistake or ignorance and not made with intention of any fraud or any wilful misstatement or suppression of facts then you have an opportunity to correct and make it good.
The taxpayer has got one last opportunity to correct the mistake by paying the amount of tax along with interest. This is possible by paying the tax along with interest in Form GST DRC 03. In cases where a taxpayer will self-correct without notice being served upon him, the penalty will not be levied.
Note: It is important to note that the clarification focuses only on making payment of taxes and not on utilizing ITC or claiming the refund.
Note: It is important to note that if a transaction was B2B and recorded as B2C or vice versa can not be rectified in Annual Return.
Note: There is no clarity as to if someone makes the changes in the annual return will it reflect in the other concerned person’s return too?
Note: Clarification issued by Government specifically doesn’t mention that an error in filing GSTR-4 can be corrected in Annual Return (GSTR-9A) for composition taxpayers. But the updated CGST Rules, 2017 mentions that even composition taxpayers can pay additional liability using Form GST DRC-03.
What is Form GST DRC 03?
Form GST DRC-03 is GST Form for making payment voluntarily or in response to the show-cause notice issued by a proprer officer from GST Department. Taxpayers have an option to pay tax on any additional liability declared in Annual Return using electronic cash ledger only in Form GST DRC-03.
- If a person has paid GST on certain goods and services at the time of purchase and has a valid invoice too, but is unable to claim the ITC as the supplier has not filed the GST Return?
- If an unrecorded outward supply is recorded and tax is paid by the supplier while filing GSTR 9, then will the recipient get the credit of the same? or if he has already filed the annual return by making the payment, will the recipient get the refund?
- If the actual transaction was B2C and was wrongly recorded as B2B and the recipient has already claimed the credit (willful fraud) can you(supplier) still correct the error made?
- Why additional liability which is to be paid in Form GST DRC 03 cannot be paid by utilizing the credit in the electronic credit ledger? Why it specifically states that the payment needs to be made by debiting the electronic cash ledger only?
- If the mistake from B2C is corrected to B2B, will the recipient get the credit of taxes paid at the time of purchase? (this is only possible if B2B to B2C or B2C to B2B will be allowed).