What Is GSTR-2 And What Are The Details Required To Be Furnished In GSTR-2?

GSTR2  is a return which is used to record and file all the details of inward supplies of goods or services of a taxpayer. The form will be filled online on the GST portal after registration. Each registered recipient will have to file GSTR 2 furnishing details of inward supplies (purchases and imports) of goods and services made by him in a particular month. GSTR 2 is to be filed on or before the 15th of the next month. For instance, the GSTR 2 form for the current month will be filed by 15th of next month.

The fascinating part of GSTR 2 is that most of the columns in GSTR 2 will autofill with the details provided by your supplier in his GSTR-1 return form. You can review the information, accept or reject, edit if necessary, add remaining details in your GSTR 2 form, and submit in case you differ with the details provided by your supplying his GSTR-1 return.

Features of GSTR2 Return :

 

• GSTR2 is a GST Tax return form used to input the details of inward supplies of a taxpayer (i.e., Purchases)
• And the due date for filing this form is 15^th of next month for the tax period for which the GSTR 2 return is to be filed.
• The taxpayer has to record here, the invoice wise details of all inter-State and intra-State supplies received from registered persons or unregistered persons.
• In case of an exporter, the Exporter has to record the details of the imports made during the particular tax period for which the GSTR-2 return has to be filed.
• A taxpayer also needs to record here the details of debit and credit notes, if any, received from supplier.
• In FORM GSTR-2, eligibility will be determined at the invoice level, so the registered person will be required to mention the inward supplies in respect of which he is not eligible for input tax credit in the table asking details of about input tax reversals during the tax period.
• The registered person is also required to declare the quantum of ineligible input tax credit on inward supplies which is relatable to non-taxable supplies which cannot be determined at the invoice level in FORM GSTR-2.

So who has to submit this return? GSTR2 return Form is required to be filed by all the normal GST registered taxpayers whether or not any inward transactions (purchases) of goods and/or services were made for the particular tax period. GST composition registered dealers do not have to file GSTR 2 return.

Note:  The transaction date will be the date mentioned on the tax invoice.

 Deadline for GSTR 2 Form Filing : The deadline fixed for filing GSTR-2 in the originally drafted GST law is 15th of the next month for a particular tax period, however, the filing of GSTR-2 has been suspended until March 31, 2018, by the Committee of Officers. The detailed schedule shall be updated soon.

Instructions and Checklist before filing GSTR-2 Form :

• Take care while entering tax details and related figures as the amendment in GSTR form is a complex procedure with fine and penalties.
• Cross check the details with original invoice and receipts (only purchase) while tax data input
• Check for stable internet connection while uploading forms.
• It is advisable to file the return within specified deadline and avoid late penalty.
• Concern with your CA while filing any GSTR form for better compliance.

Details that are required to be furnished in GSTR-2 Return :

1. Reporting of my B2B Invoices? B2B Inward supplies are of 2 types
2. B2B Inward supplies received from Registered person not subject to Reverse charge (Table 3) : Most of its​ details is auto populated from GSTR 1 filed by supplier and it will contain details as such invoice type, rate and amount of GST, whether ITC is eligible, amount of ITC.
3. B2B inward supplies subject to Reverse charge in the hands of Recipient (Table 4) : In GST we have seen certain goods and services attracting tax on reverse charge mechanism. And where in if you have made purchases from an unregistered dealer in excess of Rs. 5,000/- in a day then you are​ liable to pay tax on reverse charge basis. All such purchases have to be reported here by you here under Table heading 4 of GSTR2 which has three parts

• 4A – Some supplies have been​ specifically mentioned under GST law which attracts Reverse charge all such supplies has to be covered in this part.
• 4B – This will head all those supplies from unregistered dealer which exceed Rs. 5,000 per day from an unregistered dealer
• 4C – GST paid by you on RCM on your import of services will be finding place in this part.

1. Reporting about the Imported goods, Input/Capital goods from Overseas/ SEZ units (on bill of entry) ?

 5A – Imports :

• The GSTIN to be filed by you would be GSTIN of Recipient
• Taxable Value would mean the assessable value for customs purposes on which only your IGST liability is computed (Note : IGST is levied on customs value plus Specified customs duty.
• Generally all your transactions pertaining to this​ heading are auto populated from column 1 to 8
• Return tax preparer has to fill details in column 9 to 11 to claim ITC of IGST paid by you on your imports.
• 5B – SEZ Units :
• When you have received your supplies from SEZ units the same will be reported here in your GSTR 2
• You are mandated here to provide information pertaining to Bill of entry including 6 Digits Port code and 7 Digits bill of entry number.
• Return tax preparer has to fill details in column 9 to 11 to claim ITC of IGST paid by you on such inward supply.
• Amendments to the details pertaining to my Inward supplies furnished in the return (under the tables 3,4 and 5) by me of earlier tax periods ?

 The details which​ you want to amend finds its spot under the heading 6 of GSTR 2 filing of yours

• ITC available but was wrongly reported by you​ in respective table can be modified here or
• Invoice level eligibility of ITC if wrongly reported by you could also be modified here and
• Amendments in details in respect of import of goods from Overseas/SEZ units (from Table 5A and 5B) and in respect of B2B supply not subject to RCM (from Table 3) also could be amended

 

1. Where do the supplies procured by me from composition person, and other exempt/Nil rated/Non GST suppliers gets reflected in my Form GSTR2 ?

 

• This will get reflected under Table 7 of GSTR 2
• Since composition taxable persons cannot make interstate supplies the​ Interstate supplies column for supplies received from composition taxable person would be non- filled and intra – state supplies would be shown filled up and reflected in your GSTR2 return.
• Details pertaining to supplies received from​ exempt/Nil rated/Non GST suppliers also gets reflected in this table.

1. Where should I find my Input Tax Credit distributed to me by my Input Service Distributor in GSTR2 return?

 About ISD (Input Service Distributor)

• Applicability : Only for those taxable person having business across many state
• must have acquired separate GSTIN for each such eligible units.
• It’s just a mechanism to transfer credit amongst eligible units engaged in providing Input Services
• Contains details of the input tax credit received from a registered Input Service Distributor (ISD) (usually a head office which has transferred its ITC to all its branches)
• This data will be auto-populated fromGSTR-6 filed by ISD.

 

1. The TDS and TCS Credit on Input supplies procured by me

 

• TDS and TCS Credit will be auto – populated
• But presently TDS/TCS credit have not yet bent notified
• Sales return and net value columns are not applicable in case of TDS but applicable for TCS
• E- commerce operator will collect TCS on Net Value of sales.

 

• Reporting of my advances paid to vendors ?

 

• Generally advance payment to vendors do not create any GST liability.
• However in cases where advance is paid by you to unregistered person making supplies attracting Reverse charge under gst, then you will have GST liability on hand for discharge on such advances. Such advances alone have to be reported here by you under the respective heads.
• Amendment to such advance details are also allowed

 

• ITC Reversal/Re -Claim : This heading covers your details of ITC available but for which you cannot claim credit for owing to various ITC, CGST rules. They are

 

• Reversal on account of non – payment of consideration along with tax within 180 days of invoice. Further when such payments are made in future, credit can be re – availed,
• Reversal on account of issuance of credit note to the input service distributor ,
• Reversal when input/ input services is partly used for business and partly for non business purpose or partly used for (Taxable + Export Supply) and partly used for exempt supply, and

• Rule 42(2)(a) of CGST rules says where in after furnishing your Annual return where in 

• The ITC on inputs of exempted/non-business purpose claimed by you > ITC actually reversed during the year then you have to pay the difference in your GST return of September following end of FY with interest @ 18% p.a., from 1^st April following end of Financial year. 

• The ITC on inputs of exempted/non-business purpose claimed by you <I TC actually reversed during the year then you can claim the difference in your GST return of September following end of Financial year without interest. 

• Reversal when capital goods are partly used for business purposes or partly for other purposes or partly used for effecting taxable supplies including zero rated supplies and partly for​ effecting exempt supplies. Here you are eligible​ to take full ITC on receipt of such capital goods and thereafter proportionate ineligible ITC will be added to output tax liability for next 60 months.
• Reversal on account of any other liability – For example : Where you are​ a Registered taxable person and now you are opting for composition scheme, the ITC in respect of your stock in hand on the date of opt out will be added to​ your liability.

1. Addition and reduction of amount in output tax for mismatch and other reasons : This table captures the additional tax liability that arises due to the corrections made to the GSTR-3 of the previous month.

• ITC claimed on mismatched/duplication of invoices/debit notes: Cases of Mismatch in invoices, double claiming of ITC, the result of which excess ITC was claimed by you in your returns, such excess ITC claimed from duplicate purchase invoices will be reversed and added to the tax liability in this section of GSTR 2
• Tax liability on mismatched credit notes: There may be cases wherein incorrect credit note issued by you would have resulted in incorrect ITC being claimed. Such Extra ITC claimed due to mismatch will now be added to your tax liability.
• Reclaim on account of rectification of mismatched invoices/debit notes:  Cases of Mismatch in invoices, double claiming of ITC, the result of which the ITC has been claimed lower. You are here entitled to more ITC and so the additional amount will be reduced from the output tax liability.
• Reclaim on account of rectification of mismatched credit note (Reduce): There may be cases wherein incorrect credit note issued by you would have resulted in lower ITC being claimed. You are here entitled to more ITC and so the additional amount will be reduced from the output tax liability.
• Negative tax liability from previous tax periods: This is due to excess tax paid during the previous months and will be reduced from output tax liability of this month.
• Tax paid on advance in earlier tax periods and adjusted with tax on supplies made in current tax period (Reduce):This refers to tax paid along with advance payments in earlier months for supplies received during this month. 

 

1. HSN summary of Inward Supplies : This section requires a registered dealer to provide HSN wise summary of goods purchased. It willbe entered by the taxpayer.

Conclusion : In the initial phases, we do expect stabilization and refinement in the law, rules and APIs. To support these changes, Tally.ERP 9 has continuously worked towards providing the right solution with minor/maintenance releases on Tally.ERP 9 Release 6.1 and the next major release Tally.ERP 9 Release 7 providing you a “connected experience” with the GSTN system and get you GST ready from every angle. See the vision for GST compliance is the target goal for ERP Software companies like Tally. Users could easily synchronize with Tally’s ERP Software as it provides simplicity, accuracy, and best reporting standards that one could rely upon to make a head start journey into GST arena.