GSTR-9 is an annual GST return return filed by 31st December of the year following the particular financial year. GSTR-9 return contains sales, purchases and GST charged and paid on the same during the financial year. As a finance leader and professional, you must have known that filing GSTR-9 is more than just consolidating GSTR-1, GSTR-2B and GSTR-3B filed during a financial year. It involves rigorous reconciliations and any short paid tax or excess tax credit claims must be settled with the government. So, let's deep dive into GSTR-9 in this article. You can learn the following-What is the GSTR-9 annual return?Who should file GSTR-9 annual return?What is GSTR-9 due date?GSTR 9 turnover limitGSTR-9 typesContents of GSTR-9 and GSTR 9 Format Quick steps to file GSTR-9Consequences of not filing GSTR-9FAQs on GSTR-9Latest Updates53rd GST Council meetingAs on 22nd June 2024, the Council has recommended to provide relaxation to taxpayers from filing GSTR-9/9A for FY 2023-24 where their aggregate annual turnover for the said financial year is below Rs.2 crore.

Within the GST framework, there are three key concepts related to Input Tax Credit (ITC) that businesses must understand - Interest on excess ITC claimed, interest on ITC reversal, and interest on ITC availed but not utilised. These concepts helps you calculate interest as per the situation. Let's take a closer look at each of these concepts.Interest on excess ITC claimedWhen an entity claims more Input Tax Credit (ITC) than it is eligible for, it is considered   as 'excess ITC claimed'. The government levies an interest of 18% on this over-claimed amount. The objective is to ensure compliance and deter businesses from claiming more credit than they are entitled to.

In the world of GST, understanding the distinction between availed ITC and claimed ITC is important. This article explains the difference between availed and claimed ITC in GST to provide clarity for businesses and finance professionals.What is the Availed Input Tax Credit?The availed Input Tax Credit (ITC) means the tax credits that a business receives for taxes paid on its inputs. These inputs could be goods, services, or capital goods used during business operations.  Putting it simply:A company procures goods or services, incurring GST on those purchases.This GST paid gets recorded in the business's books of accounts as availed ITC.Subsequently, the business reports this in its GSTR 3B return, making the credit available in the Electronic Credit Ledger.For example, if a manufacturer pays GST when purchasing raw materials, the GST amount becomes an availed ITC for the manufacturer.  However, there are certain expenses for which businesses are not eligible to claim ITC, i.e, they cannot avail of the input tax credit. These non-eligible credits are clearly defined in section 17 (5) of the CGST Act. What is the Claimed Input Tax Credit?The claimed Input Tax Credit means using the available ITC to reduce or offset a business's GST liabilities. Once the ITC is available in the Electronic Credit Ledger, it can be 'claimed' or utilized against the GST payable on sales or outputs.To elucidate:A business sells goods/services and calculates the GST liability on those sales.Instead of paying this entire liability in cash, the business can claim or utilize the availed ITC from its Electronic Credit Ledger to reduce its payable amount.Continuing the earlier example, the manufacturer who availed ITC on raw materials can claim this ITC when selling the finished product to reduce the GST liability on the sale.What is the Difference Between Availed, Utilised, and Claimed ITC in GST?At first glance, these terms might seem interchangeable, but they have distinct meanings in the GST framework:Availed ITCThis is the initial recognition and recording of the input tax credit in the business's books and subsequently in the Electronic Credit Ledger after the GST has been paid on inputs.Claimed ITCThis is the actual use or application of the availed ITC to reduce the GST liability.

The Goods and Services Tax (GST) framework introduced the Input Tax Credit (ITC) concept. But what happens if a taxpayer avails ITC incorrectly? This article explains the penalty for wrong availment of ITC under GST.What is the penalty for wrong ITC availment under GST?  In the GST framework, the penalty mechanism ensures adherence and compliance by taxpayers. If a taxpayer misuses the Input Tax Credit (ITC), certain penalties apply:Wrongful Availment: As per the GST provisions, if an entity wrongly avails ITC but hasn't utilised it, it must reverse the credit along with interest within a specific period. Failing to do so may lead to penalty proceedings.Penalty Amount: If you have wrongly availed and utilised the ITC, the penalty can range up to 100% of the ITC amount availed or INR 10,000, whichever is higher.Interest Component: Following the retrospective amendment in Section 50 of the CGST Act from 1.7.2017, interest is now chargeable only on ITC wrongly availed and utilised, not just on wrongly availed.Specific Provisions: Section 122 of the GST Act clarifies that penalty can be levied for ITC wrongly availed or utilised. Thus, even if ITC is availed but not used, a penalty may still be applicable.Intention Matters: The Department may seek to imply mala fide intention to evade tax and, hence, could levy a higher penalty.

In case of the death of a sole proprietor, the business can either be cancelled or transferred to the legal heirs or a new owner. Transfer of business in case of death of a sole proprietor includes obtaining legal certificates, transferring assets and liabilities, and applying for the transfer of ITC. This is because the legal heir will need to apply for a new GST registration in their own name and cannot continue the business in the name of the deceased sole proprietor due to the proprietor having a different PAN.In this article, we explain the steps that the legal heir has to follow in the event of the death of a sole proprietor in the context of GST compliance. Find out the steps for cancellation of GST registration or transfer of business in the case of death of a sole proprietor and the documents required for it.Options Available in The Event of Death of a Sole Proprietor In the event of the death of a proprietor in GST, the legal heirs or representatives of the deceased person have two options:Cancellation of GST registration: The legal heirs or representatives can apply for the cancellation of GST registration in case of death of a sole proprietor. In this case, the legal heirs or representatives need to apply for the cancellation of the GST registration by submitting Form GST REG-16.Transfer of business: The legal heirs or representatives can apply for a transfer of GST registration in case of death of a sole proprietor by submitting an application to to the office of the Proper (Jurisdiction) Officer for becoming an authorised signatory and completing the necessary procedures detailed below. Documents Required as Proof By The Legal Heir Under GSTHere are the documents required for cancellation of a GST registration in case of death of a sole proprietor:Identity card (such as PAN, Aadhaar, or passport) with the names of both the deceased proprietor and the legal heirIdentification proof of the deceased proprietorSuccession certificateDeath certificate of the proprietorNo objection certificate (NOC) if there are multiple legal heirs in favour of the person (authorised signatory) who is applying for the GST cancellation on the death of the proprietor Steps for Cancellation of GST Registration in Case of Death of a Sole ProprietorHere is a step-by-step guide on how to cancel a GST registration in case of death of a sole proprietor:Apply for ‘Change of Authorised Signatory’ with the jurisdictional GST officer to file pending GST returns and cancel the GST registration.

A significant change that GST introduced was the mechanism of input tax credit under GST. document.addEventListener('DOMContentLoaded', () => { let proTip = document.getElementById('proTip-link'), utm_campaign = "inine_cta",utm_source="e-invoicing-system-comparison-gst",utm_medium="content"; proTip.href = `https://cleartax.in/s/contact-sales?pageCategoryType=maxitc&utm_source=${utm_source}&utm_medium=${utm_medium}&utm_campaign=${utm_campaign}&ref=${window.location.href}` }); Here’s a quick check on what can you expect from this article:For beginners – Don’t worry if you have never heard of ‘input tax credit’ before. We’ll start from scratch.For businesses – If you are a business, you may have already heard of VAT input credit, and you will soon know how it differs from GST input tax credit.Latest Updates1st February 2022Budget 2022 updates-1. ITC cannot be claimed if it is restricted in GSTR-2B available under Section 38.2. Time limit to claim ITC on invoices or debit notes of a financial year is revised to earlier of two dates. Firstly, 30th November of the following year or secondly, the date of filing annual returns.3.

It is easy to guess that you are not fully GST compliant unless your ITC claims are in place. It is beneficial if businesses may have access to a report which specifies what % of their credit is unmatched and they’ll have to work with suppliers to minimise the gaps.Latest updates1st February 2022Budget 2022 update-Sections 42, 43, 43A on matching and reversal of ITC provisions are removed by the virtue of the removal of provisional ITC in the Finance Bill 2022.What does a mismatch in credit mean for issuing scrutiny notices?Several taxpayers are concerned about the issues around the non-availability of credit.Here’s basically what mismatched credit means –Differences between the amount of credit shown in GSTR- 3B and GSTR-2B or GSTR 2ADiscrepancies between GSTR-3B and GSTR-1Any differences noticed between these returns will lead to scrutiny notices being issued to the taxpayers. Modes of communicating differences noticed in the returns by officersAny difference noticed by the authorised officer shall be communicated to the concerned person in Form GST ASMT-10. Contents of the form:Observations of the officerTime available to the taxpayer to give his explanation in response to this notice.Tax amount that is different and is the reason for the discrepancy may or may not be mentioned in this form.Actions available to taxpayers who receive noticeView Form GST ASMT-11  View Form GST ASMT-12Any differences between your monthly/quarterly/yearly GST returns?  Clear is a one-stop solution for various taxpayers regarding these notices:GSTR 3B Vs GSTR 1 report is generated to help customers know about any differences connected to payment of taxes on all outward suppliesA comparison report between GSTR 3B and GSTR 2B is generated. This helps to be sure that the credits claimed are related to taxes actually paid by the suppliers.The invoicing cum filing platform fastens the invoice generation and return filing process with accuracy. Invoices created via ClearTax help in auto preparation of the GST returns and thus the chances for errors get reduced to almost nil.Multiple validations connected to GST are done.

The government changed the procedure for the order of set-off of the same with effect from 29th March 2019. The new rules were laid down to reduce the balance lying under IGST credits to optimise the distribution between the Center and the state. However, if the mechanism is not understood and off-set is not optimised, then the businesses might end up with higher working capital requirements. Hence, it is important to understand the order of utilisation of input tax credit, how to optimise input tax credit, and the impact on business.Latest Updates1st February 2023 Budget 2023 updates*  1. Section 16 is amended to state that buyers who fail to pay their supplier the invoice value, including the GST amount, within 180 days from the date of issue of the invoice, must pay an amount equal to the ITC claimed along with interest under Section 50. 2.

Reversal of input tax credit by the recipient due to non-compliance by the supplier is one of the biggest issues faced by the taxpayer since the implementation of GST.1st February 2022Budget 2022 updates-1. ITC cannot be claimed if it is restricted in GSTR-2B available under Section 38.2. Time limit to claim ITC on invoices or debit notes of a financial year is revised to earlier of two dates. Firstly, 30th November of the following year or secondly, the date of filing annual returns.3. Section 38 is completely revamped as ‘Communication of details of inward supplies and input tax credit’ in line with the Form GSTR-2B.

Invoice Furnishing Facility (IFF) allows small taxpayers to upload their invoices every month. The Central Board of Indirect Taxes & Customs (CBIC) had notified the Invoice Furnishing Facility on 10.11.2020 via notification number 82 /2020-Central Tax.Latest Updates26th August 2021From 1st September 2021, taxpayers will not be able to file GSTR-1 or use the IFF for August 2021 on the GST portal if they have pending GSTR-3B filings. It applies if GSTR-3B is pending for the past two months till July 2021 (monthly filer) or for the last quarter ending 30th June 2021 (quarterly filer), as per CGST Rule 59(6).28th May 2021At the 43rd GST Council meeting, the following was announced:(1) The time limit to furnish B2B supplies on the IFF (optional facility for the taxpayers opting into the QRMP scheme), for May 2021 has been extended from 13th June to 28th June 2021. (2) For any delayed submission of PMT-06 for April 2021 and May 2021, interest relief has been provided as follows:(i) For April 2021, No interest is charged for delayed submission up to 9th June, whereas 9% of reduced interest is charged between 10th June and 9th July, and 18% of interest is charged thereafter.(ii) For May 2021, No interest is charged for delayed submission up to 10th July, whereas 9% of reduced interest is charged between 11th and 25th July, and 18% of interest is charged thereafter.(3) Quarterly GSTR-3B filing for Jan-Mar 2021 has also got interest and late fee relief as laid down here.1st May 2021The time limit to furnish B2B supplies on the IFF (optional facility for the taxpayers opting into the QRMP scheme), for April 2021 has been extended from 13th May to 28th May 2021. What is the Invoice Furnishing Facility? The Invoice Furnishing Facility (IFF) is a facility where quarterly GSTR-1 filers can choose to upload their Business-to-business (B2B) invoices every month, currently under the QRMP scheme only. It is governed by Rule 59(2) of the CGST Rules, available to regular taxpayers having an annual aggregate turnover of up to Rs.5 crore. One should keep the following points in mind before utilising the IFF:The IFF is an optional facility.