NEW GSTR-2B IS AN INVOICE MATCHING ENABLER

[Dr. Sanjiv Agarwal]

Background

GST was mainly introduced three years back with the prime objective to mitigate cascading effect and allowing seamless and automatic input tax credit (ITC) which was not available in earlier tax regime but this could not happen in last three years.

The GST Council, in its 39th meeting held on 14.03.2020, had recommended to adopt and implement the incremental approach of linking the present system of filing of GSTR-3B and GSTR-1 and other significant changes like enhancements in GSTR-2A and its linking to GSTR-3B. One such enhancement that the Council recommended was introduction of an auto-drafted input tax credit (ITC) statement which would aid in assisting / determining the input tax credit that is available for every taxpayer.

What is GSTR-2B?

GSTR-2B is an auto-drafted ITC statement which will be generated for every registered person on the basis of the information furnished by his suppliers in their respective GSTR-1, 5 (non-resident taxable person) and 6 (input service distributor). It is a static statement and will be made available for each month, on the 12^thday of the succeeding month. It is expected that GSTR-2B will help in reduction in time taken for preparing return, minimising errors, assist reconciliation & simplify compliance relating to filing of returns.

GSTR2B shall be available to all the regular taxpayers. Every recipient can generate it on the basis of the GSTR-1, GSTR-5 and GSTR-6 furnished by their suppliers. The statement will clearly show document-wise details of ITC eligibility.

ITC information will be covered from the filing date of GSTR-1 for the preceding month (M-1) up to the filing date of GSTR-1 for the current month (M). For instance, GSTR-2B generated for July, 2020 will contain documents filed by their suppliers from 12 a.m. on 12^thJuly, 2020 up to 11:59 p.m. on 11^thAugust, 2020.

Key features in GSTR-2B

Newly introduced GSTR-2B has the following salient features:

1. It contains information on import of goods from the ICEGATE system including inward supplies of goods received from Special Economic Zones Units / Developers.
2. A summary statement which shows all the ITC available and non-available under each section.
3. The advisory given against each section clarifies the action to be taken by the taxpayers in their respective section of GSTR-3B;
4. Document level details of all invoices, credit notes, debit notes etc. is also provided both for viewing and download.

Objectives of GSTR 2B

The data in GSTR-2B is reported in a manner that allows taxpayers to conveniently reconcile and match ITC with its own books of accounts and records. It will help them in easier identification of documents to ensure the following:

• The input tax credit is not availed twice against a particular document.
• The tax credit is reversed as per the GST law in their GSTR-3B, wherever required.
• GST is correctly paid on a reverse charge basis for the applicable documents, including import of services.

 How to download GSTR-2B on the GST portal?

The following are the steps to access GSTR 2B:

Step 1: Log in to the GST portal.

Taxpayer must use its credentials to login.

Step 2: Navigate to the ‘Returns Dashboard’.

Step 3: Select the relevant tax period.

Select the month and year.

Step 4: Click on the ‘GSTR-2B’ tab.

Step 5: Click on the ‘Download’ button to save the statement on your system.

 Input tax credit will marked as not available in the following two scenarios:

• Where the time limit to avail input tax credit on an invoice or debit note has expired under section 16(4) of the CGST Act (earlier of 30th September of the year following the financial year or date of filing annual returns).
• The state of the supplier and place of supply is the same, whereas the recipient is located in another state.

Facilities available to tax payers through GSTR-2B

The GSTR-2B would enable and facilitate the taxpayers in the following manner:

• To view and download the summary statement as a PDF file.
• Taxpayer can obtain section-wise details or complete download of ITC instantly.
• Availability of section-wise advisory to taxpayers.
• Allows text search for all the generated records.
• Option to view, filter and sort data, as required.
• To hide/view the columns as per the user’s convenience.
• Where the file contains more than 1,000 records, options for a full download of GSTR-2B and the advanced search is available.
• An email or an SMS will be sent to the taxpayer informing about the generation of GSTR 2B.

Epilogue

With the introduction of form GSTR-2B, the weakness in GST system / framework in relation to matching of invoices has now been taken care of and as a result matching of invoices will be done periodically and input tax credit will be available. However,it is an auto drafted form hence,taxpayers cannot make any change in GSTR 2B for theerrors oromission made by the suppliers.