Sandipan Mitra is the CEO and co-founder of Pice. He boasts eight years of experience in the B2B and fintech sector. Sandipan's journey includes significant roles at multiple Indian Unicorns Including Product at PayU, and as founding member / VP, Product at Open Financial Technologies.
GSTR-9 audit checklist ensures accuracy in annual GST returns by reconciling purchase, sales, and ITC records.
Businesses must reconcile inward supply data with GSTR-2A/2B to avoid wrong ITC claims and tax mismatches.
Proper verification of outward supply records with GSTR-1 and GSTR-3B ensures correct GST liability reporting.
Maintaining internal documents like invoices, challans, bank statements, and ledgers is key to GST compliance.
Filing GSTR-9 along with GSTR-9C reconciliation enhances transparency, prevents errors, and avoids GST penalties.
GSTR-9 is a form that entails all the details of GST returns for a business during a financial year. As a result, it needs to be accurate and error-free to help you claim input tax credit (ITC).
The GSTR-9 audit checklist helps you verify that all the necessary details are available and accurate. This further helps you avoid incorrect data entries, wherein the audit process can be seamless. Keep reading here to learn about this checklist and its inclusions to experience a smooth Form GSTR-9 annual return and audit process.
Objectives of the GSTR-9 Audit
GSTR-9 summarises returns of all activities associated with GST (Goods and Services Tax) for a financial year for a specific business. Ensure you check the following in the form:
This form is a consolidated report of all GST returns that a business filed during the financial year, including the purchase and sales register.
Ensure you check for discrepancies, if any.
You need to report all the details of the form.
The above-mentioned process is termed self-audit. Here are the objectives of the GSTR-9 audit:
Data Accuracy: You cannot revise GSTR-9 once you have filed. As a result, ensure you enter the correct data. You need to further ensure that you do not miss out on any details.
Reconciliation: This form allows you to reconcile annual sales and input tax credit data. Ensure you report discrepancies, if any, in the reconciliation process.
Tax Planning: In the GSTR-9 audit process, you can identify incorrect or short claims of an input tax credit. This further helps you plan the following year's GST liability.
GSTR-9 Audit Checklist: Inward supply
Inward supplies or purchases for a business include the goods and/or services it receives. Reconciling the purchase data helps report input tax credit (ITC) accurately.
To fill in the data in Tables 6, 7 and 8 for the form, you need to include the below-mentioned inward supplies in the GSTR-9 audit checklist:
Item
Description
Data Collection
You need to collect data from the purchase register, GSTR-2A and GSTR-2B
Reconciliation of ITC
● Reconcile GSTR-2A and 2B with the records of purchase. ● Reverse the ineligible input tax credit or reclaims of ITC ● Consider vendor-wise ITC reconciliation ● In case vendors report a reduced ITC figure, ensure you inform them to reverse the same. ● You need to report adjustments made with credit notes or debit notes in ITC. ● Ensure your vendor deposits the applicable GST liability. ● You need to compare the GST payable with due ITC claims (to reduce tax liability) and GST paid under RCM (reverse Charge Mechanism). ● Ensure you check the expense ledgers to ensure all ITCs are mentioned. ● Revise your annual GST returns to check for rectifications. ● Ensure you compare your Income Tax Return (ITR) with GSTR-9.
Outward supplies for a business include sales of goods and/or services. For the GSTR-9 audit checklist, you need to include the following:
Item
Description
Data Collection
You need to collect data from your sales register, GSTR-1 and GSTR-3B.
Reconciliation
● Ensure you reconcile your sales records with GSTR-1 and GSTR-3B. ● You need to ensure accurate reporting in GSTR-1 and GSTR-3B with your accounts book. ● Ensure you segregate B2B and B2C sales. ● You need to check if GST has been paid under incorrect heads for any sales. ● Ensure you verify the HSN classification for your goods and services. ● You need to ensure that there are no duplicate or missed reporting of GST liability. ● Ensure you match the shipping bills and Form GSTR-3B with exported goods from GSTR-1. ● You need to ensure accurate reporting and generation of e-invoices in GSTR-1. ● Ensure you identify incorrect reporting of supplies in Form GSTR-3B. ● You need to identify if inter-state supplies to unregistered persons have been omitted. ● Before you file GSTR-9, ensure you identify and rectify errors in GST returns.
Internal Documents Checklist
To ensure that your internal document checklist is correct, here is the GST annual return checklist:
● Book of Accounts: Ensure your accounting and financial statements include correct statements such as accurate annual turnover, cost audit report and others. This includes your purchase and sales registers, followed by your ITC register.
● Bank Statements: You need to reconcile your bank statement with GST returns and transactions associated with GST.
● GST Invoices: Ensure you keep your GST invoices, credit notes and debit notes that you send and receive, to verify GST returns.
● Tax Payments: To maintain proof of payment of tax during a financial year, ensure you keep the GST challans.
The Importance of Reconciliation in GSTR-9
Businesses registered under GST, including SEZ units and developers with turnover above a certain limit, must file a reconciliation statement in Form GSTR-9C along with their annual return. This reconciliation helps match the data reported in GST returns with the figures recorded in the company's books of accounts. Since returns are filed using specific formats and accounting is done based on broader business practices, discrepancies may arise.
Reconciliation ensures that such differences, arising from trade discounts, credit notes, unbilled revenue, or timing mismatches, are identified and explained. It helps tax authorities verify that the returns filed are accurate and compliant with GST law.
The annual return in Form GSTR-9 summarizes all outward and inward supplies made during the year. However, since the accounting books may not always align with how transactions are reported in GST returns, reconciliation becomes vital.
Taxpayers exceeding the turnover threshold are also required to get their accounts audited and file Form GSTR-9C, a certified reconciliation statement. This process enhances transparency and helps avoid penalties due to mismatches. In essence, reconciliation is a critical step to ensure financial and tax accuracy in GST compliance.
A GSTR-9 audit checklist ensures that all the necessary data and key details from all GST returns during a year are incorporated and maintained accurately. This further ensures that you maintain your purchase register, sales register, ITC register, invoices, challans, credit and debit notes in a systematic manner. Ensure you keep the necessary documents handy for a hassle-free GST audit.
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FAQs
What is the purpose of the GSTR-9 audit checklist?
The GSTR-9 audit checklist serves as a guide for businesses to ensure accuracy in filing annual GST returns. It helps verify purchase registers, sales data, ITC claims, and reconciliations with GSTR-1, GSTR-2A/2B, and GSTR-3B. By following the checklist, businesses can avoid errors, ensure compliance, and minimize the risk of penalties due to mismatched or missing data in annual returns.
Why is reconciliation important in GSTR-9 filing?
Reconciliation in GSTR-9 filing ensures that the data reported in GST returns matches the company’s books of accounts. Differences may arise due to credit notes, trade discounts, or timing mismatches. Proper reconciliation through GSTR-9 and GSTR-9C reduces discrepancies, provides transparency to tax authorities, and ensures smooth GST compliance while avoiding unnecessary disputes or penalties.
What documents are required for the GSTR-9 audit checklist?
Businesses must maintain a strong set of documents for the GST annual return checklist, including purchase and sales registers, ITC register, GST challans, invoices, credit/debit notes, and bank statements. These documents help reconcile tax liabilities with payments made and verify ITC claims. Having these records ready makes the GSTR-9 audit process seamless and hassle-free.
How should businesses verify inward and outward supplies in GSTR-9?
For inward supplies, businesses need to reconcile purchase registers with GSTR-2A and GSTR-2B, reverse ineligible ITC, and verify vendor compliance. For outward supplies, sales data should be matched with GSTR-1 and GSTR-3B, ensuring correct reporting of B2B, B2C, exports, and e-invoices. This process ensures accurate tax liability reporting and strengthens GST return accuracy under the GSTR-9 audit checklist.
Who is required to file GSTR-9C along with GSTR-9?
Businesses registered under GST with an annual turnover above the prescribed threshold must file Form GSTR-9C along with GSTR-9. This is a reconciliation statement certified by a Chartered Accountant or Cost Accountant. GSTR-9C ensures that the figures reported in GST returns match with audited financial statements, enhancing credibility, compliance, and accuracy in annual GST audit filing.
Sandipan Mitra is the CEO and co-founder of Pice. He boasts eight years of experience in the B2B and fintech sector. Sandipan's journey includes significant roles at multiple Indian Unicorns Including Product at PayU, and as founding member / VP, Product at Open Financial Technologies.
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