Comparison between GSTR-3B and GSTR-2A

Did you know that matching GSTR-3B with GSTR-2A is essential for businesses which helps them regain the right amount of tax credits owed and fix any mistakes in claiming too much? Doing this check before filing GSTR-3B helps avoid getting notices from tax authorities asking for more taxes. Since GSTR-2B started in 2020, a Comparison of GSTR 3B and GSTR 2A credits now happens once a year. But it’s still important, especially for TDS and TCS credits.

One can submit the form GSTR-3B which is like a monthly report before the 20th of the month. If that form can be filed quarterly, it’s due by the 22nd or 24th of the month after that. 

GSTR-3B Vs GSTR-2A

Let’s look at some differences between GSTR-3B and GSTR-2A.

Form GSTR-2A is like a list that shows what you bought from suppliers. It’s automatically made based on what your suppliers report in their forms. Even though completing GSTR-2 has been stopped, you must check that the tax credits you claim in Form GSTR-3B match those in Form GSTR-2A. This helps ensure that everything adds up correctly.

How to Reconcile GSTR-3B and GSTR-2A?

Let’s read what to do to match up the comparison of GSTR 3B and GSTR 2A or GSTR-3B:

1. Collect info from GSTR-2A and the ITC part of GSTR-3B for a specific time.
2. Decide how to do the matching—either by hand using sheets or by using special software.
3. Compare the ITC list in GSTR-2A with the eligible ITC in GSTR-3B for each type of tax: CGST, SGST, and IGST.
4. Look closely at each vendor’s information to see if there are any differences. If you find any, talk to the vendor to resolve the issue.

When you compare the two sets of data, you might get these results:

1. Matched: The entries in both GSTR-2A/2B and GSTR-3B should match perfectly.
2. Not matched: Some entries in one dataset don’t appear in the other and do not match.
3. Partially matched: The invoice numbers might differ, but the values match.
4. Suggested match: This feature, available in tools like Clear GST, helps find close matches between GSTR-2A/2B and GSTR-3B using smart logic.

Importance of GSTR-3B and GSTR-2A

It’s essential to ensure the comparison of GSTR 3B and GSTR 2A values in GSTR-3B matches those in GSTR-2B for a given period. If you’re claiming ITC over what’s in GSTR-2A, ensure it meets the eligibility criteria according to the CGST Act and Rules.

It’s essential to check and match up Form GSTR-3B with Form GSTR-2A for a few reasons:

1. Notices from GST Authorities: The tax folks have sent notices to many taxpayers asking them to ensure the tax credits they claim in Form GSTR-3B match what’s in Form GSTR-2A. They might have to explain or pay extra if there’s a difference.
2. Stopping Tax Cheats: Some people try to cheat on taxes by claiming credits for taxes they never paid, using fake invoices. Checking and matching up the forms helps catch these cheaters.
3. Making Sure Credits Are Right: Matching up the forms ensures taxpayers only claim credits for the taxes paid to their suppliers, keeping things fair and accurate.

It’s necessary to compare the GSTR 3B and GSTR 2A invoices received and recorded only once. If a supplier needs to remember to report their sales, you can remind them to fix it. Mistakes in reporting by either suppliers or recipients can be fixed.

Using software like Clear GST can help find differences between GSTR-3B and GSTR-2A/2B and what’s in your records. When filing the yearly return (Form GSTR-9), you must ensure the Input Tax Credit matches GSTR-3B and GSTR-2A. 

Reasons for Non-Reconciliation of GSTR-2A vs 3B

Sometimes, the information in Form GSTR-2A and Form GSTR-3B doesn’t match up for a few reasons:

1. IGST for Imported Goods: When you import goods and pay IGST (a type of tax), this tax doesn’t show up in GSTR-2A because sellers from other countries still need to file a GSTR-1 form in India.
2. IGST for Imported Services: Just like with goods, when you import services and pay IGST, these don’t appear in GSTR-2A because foreign service providers don’t file GSTR-1 in India.
3. GST on Reverse Charge: Sometimes, you have to pay GST yourself instead of the seller (this is called reverse charge). These payments can cause mismatches because they might not be immediately recorded in GSTR-2A.
4. Old Credits Carried Forward: If you have some tax credits left over before GST started (using TRAN-I and TRAN-II forms), these will only match up after GSTR-2A starts after GST was introduced.
5. Late Credit Claims: The numbers will immediately line up if you receive goods or services in one financial year but only claim the tax credit in the next year. For example, if you got something in FY 2020-21 but claimed the credit in FY 2021-22.

These issues happen because there’s no GSTR-1 form from the seller (like with imports or reverse charge items) or because the tax credit is claimed differently than when the goods or services were received.

A GST course in Kochi can significantly improve your skills in handling GST accounting software for businesses. Finprov, a well-regarded educational institution, provides an extensive GST certification course designed to give students a deep understanding of GST rules and how they apply them in real business situations. This course is perfect for graduates, chartered accountants, company secretaries, and finance and tax professionals looking to boost their career prospects.

The curriculum of Finprov’s GST certification course is quite broad, touching on essential topics like GST basics, how to utilize Input Tax Credit, understanding the Composition Scheme, navigating GST return filing, E-way bill procedures, as well as the intricacies of Time of Supply, Place of Supply, and the Reverse Charge Mechanism. It’s tailored for fresh graduates and experienced professionals aiming to hone their accounting and financial management skills. Opting for Finprov’s job oriented courses in Kochi gives you the advantage of quality education combined with practical insights, making you well-prepared to tackle accounting tasks for any business with confidence.