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Annapoorna

Assistant Manager - Content

I preach the words, “Learning never exhausts the mind.” An aspiring CA and a passionate content writer having 4+ years of hands-on experience in deciphering jargon in Indian GST, Income Tax, off late also into the much larger Indian finance ecosystem, I love curating content in various forms to the interest of tax professionals, and enterprises, both big and small. While not writing, you can catch me singing Shāstriya Sangeetha and tuning my violin ;)

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The latest articles by Annapoorna


Fake GST Summons: How To Check and Verify Fake GST Notices?
Updated on Feb 22nd, 2024 | 5 min read

Did you get a weird tax notice and feel worried? No more! In this article, you’ll figure out how to spot that fake GST summons and keep you out of trouble. Let's dive in!What is a fake summons/fake notice?A fake summons or notice is an imitation document posing as official government communication, often from tax authorities. It aims to intimidate recipients into unnecessarily paying money or disclosing personal information.Scammers do this to use your fear of getting in trouble or having to pay extra money to make you act fast without stopping to think if it's actually true. Always make sure to check with the real government office before you reply to these kinds of letters.Introduction to CBIC DGGI's advisoryThe Central Board of Indirect Taxes and Customs (CBIC) and the Directorate General of GST Intelligence (DGGI) work together to ensure that GST laws are followed and fraud prevention. Their recent advisory dated 10th February 2024 helps taxpayers recognise and deal with fake GST messages. This advice is meant to help people and businesses understand GST better and protect themselves from scams, making it easier to handle GST matters safely.How to check fake GST summons and notices? Figuring out if GST summons and notices are real can be tricky, but we've got two straightforward ways to help you check their authenticity quickly without any complicated steps.Method 1: To verify CBIC DINThe Document Identification Number (DIN) is a unique ID number for each official communication issued by the GST department.Here are the steps to follow for checking the genuineness of the DIN utility search on any communication claimed to have been sent from the GST department:Spot the DIN: First up, locate the DIN on the document.


Error Code 2150: How to Solve Duplicate IRN Error in e-Invoice?
Updated on Feb 21st, 2024 | 6 min read

Evеr stumblеd upon thе duplicatе IRN еrror in e-invoice (error code 2150) and wondеrеd what it is all about? Rеst assurеd, this is a common issue many еncountеr. Whеn gеnеrating electronic invoicеs undеr GST, gеtting this еrror codе can rеally disrupt opеrations. Howеvеr, thеrе is no nееd for concеrn. This guidе brеaks down what is causing it and thе simplе stеps to rеsolvе it. Wе will analysе thе causеs bеhind this еrror and thе mеthods to rеctify it, еnsuring your е-invoicing procеss opеratеs sеamlеssly.What is a Duplicate IRN Error in an E-invoice (Error Code 2150)?Thе duplicatе IRN, also known as Invoicе Rеfеrеncе Numbеr codеd as еrror 2150, occurs while generating e-invoices undеr India's GST systеm. This еrror is triggеrеd whеn an invoicе of a particular invoice number, for which an IRN has alrеady bееn gеnеratеd, is submittеd again to thе e-invoice portal. Reasons for Duplicate IRN Error in e-Invoice?Broadly, there are two scenarios where you can encounter duplicate IRN errors:IRN Generated and Received by ERP/POS System:In this situation, еvеn aftеr an IRN is succеssfully rеcеivеd by thе Entеrprisе Rеsourcе Planning (ERP) or Point of Salе (POS) systеms,  thе samе transaction is mistakеnly sеnt again to thе e-invoice portal.


Penalty for Wrong Vehicle Number in E-way Bill
Updated on Feb 21st, 2024 | 11 min read

Errors in dеtails such as vеhiclе numbеrs, can disrupt the Eway bill monitoring system and cause issues in logistics and distribution. To еffеctivеly managе thеsе еrrors and еnsurе adhеrеncе to GST rеgulations, pеnaltiеs arе imposеd. Thеsе can range from small finеs for minor еrrors to toughеr mеasurеs for dеlibеratе non compliancе or tax еvasion.  Join us as we navigatе thеsе crucial aspеcts, providing clarity and valuablе insights for businеssеs and individuals dealing with e-way bills.What is the penalty for the wrong eWay bill?The e-way bill system is intеgral to India's GST framework. It mandatеs accuratе documentation for thе transportation of goods еxcееding Rs.50000 in valuе. A critical aspect of this systеm is thе corrеct еntry of vеhiclе numbеrs.


Form ITC-01: Claim ITC on New GST Registration
Updated on Feb 16th, 2024 | 8 min read

On the date of obtaining the GST registration, persons carrying on regular business would be holding stock of inputs, capital goods and finished goods at their place of business. The GST paid on such goods purchased cannot be claimed as Input Tax Credit (ITC) before the date of obtaining GST registration. Only after obtaining the GST registration, taxpayers can avail input tax credit of GST paid on such inputs, capital goods and inputs in finished goods lying in stocks, from the effective date of obtaining registration.Form GST – ITC 01 is a declaration form filed on GST portal for claiming the input tax credit by taxpayers newly registered under GST. Filing of this form is mandatory to claim ITC on such stock.Cases when ITC-01 must be filedThe declaration form in ITC – 01 is required to be filed in the following cases:When an application for GST registration is made within 30 days of becoming liable to pay GST. [Section 18(1)(a)]When any person opts for voluntary registration.


Inverted Duty Structure under GST
Updated on Feb 16th, 2024 | 8 min read

Inverted tax structure simply refers to a condition where the tax rate on inputs used is higher than the tax rate on the outputs for sale. The condition may not be prevalent for all industries. The article throws light on the concept and compliance involved.Inverted tax structure in the pre-GST regimeIn the pre-GST regime, a situation of an inverted duty structure arose in cases where import duty on raw materials that were used in the production of finished goods was higher than the import duty on finished goods itself. An example which shows a case of Inverted Duty Structure: Duty on the import of tyres (Finished Good) = 10% Duty on the imports of natural rubber (Raw Material) = 20%Other Examples:ProductsImport duty onFinished GoodsRaw MaterialsFinished GoodsRaw MaterialsSolar ModulesComponents for Solar ModulesNil5-10%SeaweedAgar10%30%Dehydrated culture mediaMicroorganism10%30%Electrical TransformerSteel Tubes7.50%10%Railway locomotivesComponents5%18-28%Inverted tax structure under the GST regimeThe term ‘Inverted Tax Structure’ refers to a situation where the rate of tax on inputs purchased (i.e.GST rate paid on inputs received) is more than the rate of tax on outward supplies (i.e. GST rate payable on sales).ProductsGST onFinished Goods (Output)Raw Materials (Input)Finished GoodsRaw MaterialsFabric BagNon-Woven Fabric5%12%Refund in case of inverted tax structure under GSTA registered person may claim a refund of unutilised Input Tax Credit (ITC). The ITC on account of inverted tax structure can be claimed at the end of any tax period where the credit has accumulated on account of the rate of tax on inputs being higher than the rate of tax on output supplies.


Input Tax Credit Reversal in GSTR-3B & GSTR-2
Updated on Feb 16th, 2024 | 9 min read

Under GST you can claim the taxes you have paid on inputs (purchases) from the taxes you are supposed to pay on output(sales). To be able to claim this benefit, you must meet the following conditions –Payment the supplier within 180 days from issue of invoice Inputs and capital goods should not be used for personal purposes Inputs and capital goods should not be used for providing exempt supplies If you do not meet these conditions, you are not allowed to claim input credit of the taxes paid on inputs. However, these purchases automatically reflect in your GSTR-2A and therefore you will have to do a reversal of input tax credit on these purchases while filing your GSTR-3B (previously form GSTR-2 up to August 2017). Form GSTR-2 was suspended from September 2017 onwards and therefore GSTR-3B took over its place.ITC Reversal in GSTR-3BTable 4(B) of the GSTR-3B form pertains to ITC reversal of all types.In accordance with CGST Rules 42 and 43 of the CGST Rules, input credit for products and services used partly for business and partly for other purposes must be reversed. When supplies include taxable, exempt, and nil-rated products, input credit reversal is also needed. Any input tax credit on capital goods used for making taxable, exempt, nil-rated supplies must be allocated and reversed to the extent not used for business.Others include any other ITC which has to be reversed in the books of accounts of the taxpayer.The GSTR-2B provides information about whether or not a particular ITC is eligible for claims.


What is MIS Report in GST: Types, Uses, Benefits
Updated on Feb 16th, 2024 | 8 min read

The central idea of GST revolves around transparency, compliance, and ensuring that the process is made easy for the taxpayer. The MIS report in GST is one such tool that simplifies this process.What is MIS Report in GST?MIS stands for Management Information System, an extra tool that helps decision-makers or top management assess compliance instantly. MIS reports will allow a detailed analysis of mismatches, GST return filing status, total GST turnover, maximum Input Tax Credit (ITC) usage, and other decision-making factors.These reports help in understanding the GST compliance status and other issues. This, in turn, allows teams to make timely, informed decisions that prevent losses or non-compliance.Importance & Objectives of MIS Reports in GSTMIS reports in GST are important because they help you identify any gap in your GST compliance and thus help you in making smart business decisions. It is an added feature that includes a detailed analysis of the GST turnover and the best use of ITC, among others.Some useful aspects and objectives of MIS reports in GST are:Identifying missed invoice reporting, mismatches between GSTR-1 and GSTR-3B, and late filings to prevent penalties.Gives an idea of your compliance, allowing you to assess adherence to regulations.Identifying areas for faster ITC refund claims or minimising tax payments.Leads to improved operational efficiency and reduces administrative burden.The importance of MIS reports in GST is due to the following benefits:Detection of IssuesMismatches, missing invoices, and late filings can be identified, allowing prompt rectification and minimising penalties.Updates on RegulationsKeeping businesses informed about new GST rules and updates ensures continuous compliance and avoids roadblocks.Maximises ITC UtilisationUnclaimed ITC becomes visible, which enables businesses to optimise claims and reduce tax liabilities.Data-driven DecisionsInsights into sales tax trends, profitability, and supplier performance support strategic decisions in overall financial planning.Types of MIS Report in GSTMIS reports have various purposes that offer insights that cater to specific needs.


Avail ITC in GST as per Section 16(2)(aa)
Updated on Feb 16th, 2024 | 5 min read

From 1st January 2022 onwards, businesses must claim Input Tax Credit (ITC) that only appears in GSTR-2B. With this, Rule 36(4) of the CGST Rules loses its purpose while the new clause (aa) under Section 16(2) comes into force. This article provides complete details about the change, how this change affects businesses, and how businesses can be prepared with Clear’s solutions.What does the new clause (aa) under Section 16(2) state?The CBIC has notified 1st January 2022 that the new condition in clause (aa) of Section 16(2) of the CGST Act will be implemented. It issued Central Tax notification number 39/2021 on 21st December 2021 to give effect to Section 109 from the Finance Act, 2021, containing this addition. Section 16(2) of the CGST Act contained conditions for recipients to fulfil before claiming ITC in their GSTR-3B. These included possession of a GST invoice, receipt of the goods or services, tax on it paid to the government, and GST invoice reported in GSTR-3B. The recently added condition allows you to avail ITC if your vendor declares that invoice or debit note in their corresponding GSTR-1 or Invoice Furnishing Facility (IFF).


How to file ITC-02 on the GST portal?
Updated on Feb 16th, 2024 | 7 min read

ITC-02 is a form used for transferring the Input Tax Credit (ITC) balance in the electronic credit ledger of a GSTIN to another GSTIN due to mergers and acquisitions.What is ITC-02 and who must file it?In case of transfer of business by way of sale of business, merger or demerger, a registered taxpayer can transfer the input tax credit unutilised and available in his electronic credit ledger into another business by filing a declaration in Form GST ITC-02. It must be filed by the transferor and action must be taken by the transferee. There is no time limit specified under the Act or Rules. The entire treatment of GST in such cases can be understood from our article- ‘GST on the transfer of business’.  Need to file ITC-02Multiple amalgamations, mergers, and demergers have taken place after the implementation of GST.


Availability of ITC on Bank Charges Under GST
Updated on Feb 16th, 2024 | 7 min read

Banks offer various other services to their clients besides lending services and charge fees for each one. These service fees include but are not limited to, fees for processing loans, custodian services, RTGS/NEFT payments, and foreign exchange remittance services.All these bank charges fall under the Goods and Service Tax (GST) scope and thus are eligible for Input Tax Credit (ITC) if used for business. However, since these charges are not explicitly listed on the bank statement, taxpayers neglect to claim ITC.In this article, we’ll explain input tax credit on bank charges under GST in detail, including the scope, conditions, and time limit.Applicability of GST on various types of bank charges Banks usually apply GST to various service fees, like fees for not maintaining a minimum balance or foreign currency transactions. So, when you pay these fees, you also pay GST on the services.Here are some more points about the applicability of GST on bank charges:Exemptions: Notification No. 12/2017-Central Tax (Rate) dated June 28, 2017, provides GST exemptions for the financial industry.


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