Goods and Service Tax (GST) is a significant indirect tax reform implemented in India since July 2017. GST has been implemented to replace multiple indirect taxes with a single tax system, making it easier to pay taxes and improving the ease of doing business. The GST system has undergone a few changes in the past years, and in the financial year 2021-22, there have been significant amendments that business owners need to be aware of, especially in the context of GST audit. This article covers key amendments in Financial Year 2021-22 relevant for GST audit.
One of the most significant amendments made in Financial Year 2021-22 is to Section 35(5) of the CGST Act. This amendment requires taxpayers to file their annual returns before the due date of the GST audit report, which is 31st December of the following financial year. Failure to file the annual return on time can result in a penalty of up to Rs. 200 per day.
Another key amendment in Financial Year 2021-22 is to Rule 80(3) of the CGST Rules. This amendment requires auditors to certify that the taxpayer has maintained proper records and accounts as per the GST laws. Additionally, the auditor needs to verify the accuracy of annual returns filed by the taxpayer.
Rule 102 of the CGST Rules has been amended to include discrepancies or non-compliance of GST laws in the GST audit report. The amended rule requires the auditor to report discrepancies or non-compliance of GST laws to the taxpayer and provide an opportunity to rectify the same within 30 days from the date of the GST audit report.
Rule 101 of the CGST Rules has been amended to require the auditor to include a separate report on the reconciliation statement filed by the taxpayer. The auditor needs to ensure that the reconciliation statement reconciles the data furnished in the GST returns filed by the taxpayer.
Rule 80(2) of the CGST Rules has been amended to require the auditor to certify that the taxpayer has complied with the provisions of the GST laws. The auditor needs to verify that the taxpayer has correctly calculated the GST liability and has paid the same within the due date.
The above-mentioned amendments to the GST laws are relevant for GST audit in the financial year 2021-22. Business owners need to ensure they comply with these amendments to avoid any penalties or repercussions. It is advisable to seek help from a professional tax consultant or a GST service provider to ensure that your business complies with the GST laws.
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