The Central Board of Indirect Taxes and Customs (CBIC) has issued guidelines for GST return scrutiny for tax periods 2017-18 and 2018-19. These guidelines are intended to assist tax officials in conducting a detailed scrutiny of GST returns to identify cases of tax evasion and non-compliance. Some of the key guidelines include:
1. Identifying high-risk taxpayers: Tax officials are instructed to identify taxpayers who have high values of turnover, high input tax credit, or high tax liability. These taxpayers are considered to be at high risk of non-compliance, and their returns should be subject to detailed scrutiny.
2. Matching data from different returns: Tax officials are instructed to match data from different returns, such as GSTR-1, GSTR-3B, and GSTR-9, to identify discrepancies and inconsistencies. Any discrepancies should be investigated further to determine whether they are the result of genuine errors or intentional non-compliance.
3. Verifying invoice details: Tax officials are instructed to verify the details of invoices, such as invoice numbers, dates, and values, to ensure that they are accurate and complete. Any discrepancies or missing details should be investigated further.
4. Scrutinizing credit availed on inputs: Tax officials are instructed to scrutinize the credit availed on inputs to ensure that it is eligible and has been correctly calculated. Any ineligible credit should be reversed, and penalties may be imposed for intentional non-compliance.
5. Checking for under-reporting of sales: Tax officials are instructed to check for under-reporting of sales by comparing the turnover reported in GSTR-3B with that reported in GSTR-1. Any discrepancies should be investigated further to determine the cause.
6. Verifying compliance with reverse charge mechanism: Tax officials are instructed to verify compliance with the reverse charge mechanism, which requires the recipient of goods or services to pay the tax instead of the supplier. Any non-compliance should be investigated further.
Overall, these guidelines are intended to help tax officials identify cases of tax evasion and non-compliance and take appropriate action to ensure that taxpayers comply with GST regulations.
GST return scrutiny is a process undertaken by the tax authorities to verify the correctness of the GST returns filed by taxpayers. The objective of GST return scrutiny is to identify any discrepancies or omissions in the GST returns and ensure that the correct amount of tax is being paid by the taxpayer.
During the scrutiny process, the tax authorities may ask the taxpayer to provide additional information or clarification with regard to any particular transaction or item reported in the GST returns. The authorities may also conduct a physical verification of the goods or services on which GST has been paid.
The GST return scrutiny process is usually initiated after the due date for filing of the GST returns for a particular tax period has elapsed. The tax authorities may select returns for scrutiny on a random basis or based on risk criteria such as high-value transactions or frequent revisions of GST returns.
If any discrepancies or non-compliance is identified during the GST return scrutiny process, the tax authorities may initiate further action such as issuance of a show-cause notice, imposition of penalties, or even prosecution under the GST law. Therefore, it is important for taxpayers to ensure that their GST returns are accurate and complete, and comply with the GST law.
Here are some frequently asked questions related to GST return scrutiny:
What is GST return scrutiny?
GST return scrutiny is the process of examining the returns filed by taxpayers to ensure that the correct amount of tax has been paid and to detect any discrepancies or inconsistencies in the returns.
Who is responsible for conducting GST return scrutiny?
The GST authorities are responsible for conducting GST return scrutiny.
What are the reasons for GST return scrutiny?
GST return scrutiny can be conducted for various reasons such as random selection, identification of high-risk taxpayers, detection of discrepancies or inconsistencies in the returns, etc.
What are the consequences of non-compliance during GST return scrutiny?
Non-compliance during GST return scrutiny can result in penalties, fines, and legal action against the taxpayer.
What is the process for GST return scrutiny?
The process for GST return scrutiny involves the following steps:
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