How to deal with difference in ITC availed in Form GSTR-3B Vs. Form GSTR-2A

If there is a difference in the Input Tax Credit (ITC) claimed in Form GSTR-3B and Form GSTR-2A, the taxpayer should follow these steps:

1. Verify the ITC claimed in Form GSTR-3B with the ITC available in Form GSTR-2A for the relevant tax period.

2. If there is a difference, check the status of the invoices in question. If the supplier has not filed the Form GSTR-1 or Form GSTR-3B, the ITC may not be available to the recipient.

3. If the supplier has filed the Form GSTR-1 or Form GSTR-3B, but the invoices are not reflecting in the Form GSTR-2A, the recipient may have to follow up with the supplier to rectify the issue.

4. In case the supplier has not declared the output supply, the recipient may issue a notice to the supplier as per the provisions of Section 142(1) of the Central Goods and Services Tax Act, 2017, asking for the rectification of the same.

5. If the difference persists, the taxpayer may have to reverse the excess ITC claimed in Form GSTR-3B, as per the provisions of Section 42 and 43 of the Central Goods and Services Tax Act, 2017, along with interest.

It is recommended that taxpayers reconcile their ITC claimed in Form GSTR-3B with Form GSTR-2A regularly to avoid any issues at a later stage.

In case of a difference between the ITC claimed in GSTR-3B and the ITC available in GSTR-2A, a taxpayer can take the following steps:

1. Verify the ITC available in GSTR-2A: The taxpayer can log in to the GST portal and check the ITC available in GSTR-2A. If there is any difference in the ITC amount between GSTR-3B and GSTR-2A, the taxpayer should first verify the details of ITC available in GSTR-2A.

2. Check for missing invoices: If the taxpayer finds that some invoices are missing in GSTR-2A, they should follow up with their suppliers to ensure that the missing invoices are uploaded on the GST portal. Once the supplier uploads the invoices, the ITC will be reflected in GSTR-2A.

3. Rectify the mistake: If there is any mistake in claiming ITC in GSTR-3B, the taxpayer should rectify the mistake by filing a revised GSTR-3B for the relevant tax period. However, the revised return can be filed only if the original return has been filed within the due date.

4. Follow up with suppliers: If the taxpayer finds that the suppliers have not uploaded the invoices on the GST portal, they should follow up with the suppliers to ensure that the invoices are uploaded. If the suppliers do not comply, the taxpayer should approach the tax authorities for redressal.

It is important for taxpayers to ensure that the ITC claimed in GSTR-3B matches the ITC available in GSTR-2A. Any difference can lead to penalties and interest, and can also affect the taxpayer's compliance rating.

FAQs

1. What is Form GSTR-3B?

Form GSTR-3B is a summary return that is to be filed by registered taxpayers to report their summary of outward supplies, inward supplies, input tax credit (ITC) claimed, and payment of taxes for a particular tax period.

2. What is Form GSTR-2A?

Form GSTR-2A is an auto-populated draft statement for inward supplies that is generated for each recipient taxpayer, based on the suppliers’ filed returns (GSTR-1 and GSTR-5). It contains details of all the supplies that have been made to a registered taxpayer and is available on the GST portal.

3. What is the difference between GSTR-3B and GSTR-2A?

GSTR-3B is a summary return filed by registered taxpayers to report their summary of outward supplies, inward supplies, ITC claimed, and payment of taxes for a particular tax period. GSTR-2A is an auto-populated draft statement for inward supplies generated for each recipient taxpayer, based on the suppliers’ filed returns. While GSTR-3B is filed by the recipient, GSTR-2A is generated by the GST system based on the filed returns of the suppliers.

4. What can be the reasons for differences between the ITC availed in GSTR-3B and GSTR-2A?

There can be several reasons for the differences between the ITC availed in GSTR-3B and GSTR-2A, such as suppliers not filing their returns on time, incorrect or incomplete data entry in the returns, discrepancies in the invoices uploaded by the supplier and recipient, etc.

5. How to deal with differences in ITC availed in GSTR-3B and GSTR-2A?

The differences in ITC availed in GSTR-3B and GSTR-2A can be dealt with in the following ways:

a. Taxpayers can reconcile their ITC availed in GSTR-3B with GSTR-2A and identify the discrepancies, if any.

b. Taxpayers can request their suppliers to rectify the errors in their returns and invoices.

c. Taxpayers can take necessary actions, such as paying the additional tax liability, adjusting the excess ITC in the subsequent tax periods, etc., based on the nature of the discrepancies.

6. Is it mandatory to reconcile ITC availed in GSTR-3B with GSTR-2A?

While it is not mandatory to reconcile ITC availed in GSTR-3B with GSTR-2A, it is recommended that taxpayers reconcile these two returns to ensure that their ITC claims are correct and that they are compliant with GST regulations. This can also help avoid any additional tax liabilities or compliance issues.