2023-06-29 15:56:29
Now taxpayers under the Goods and Services Tax (GST) will be able to explain the mismatch in their inward and outward supply filed in tax return on the GST portal itself, without risking a notice from the tax authorities.
The Centre Board of Indirect Taxes and Customs (CBIC) has developed a functionality in its portal which will allow the taxpayers to find their exact tax liability on the real basis, giving them opportunity to explain any discrepancy in tax returns before issuing any tax demand.
The functionality is live from Thursday.
” It is informed that GSTN has developed a functionality to enable the taxpayer to explain the difference in GSTR-1 and 3B return online,” the GST network said in an advisory on Thursday.
This was already directed and approved by the GST Council.
The functionality compares the liability declared in GSTR-1 form with the liability paid in GSTR-3B for each return period. Under GST, a monthly self-declaration return GSTR-3B is filed by all registered taxpayers, except composition dealers. The return serves as a summary of a business’ tax liabilities and contains details of input tax credit (ITC) claimed and output tax liabilities.GSTR-1 is a monthly statement of outward supplies to be furnished by taxpayers for supplying goods and services or both either by sale, transfer, barter, exchange, licence, rental, lease or other modes.
If the declared liability exceeds the paid liability by a predefined limit or the percentage difference exceeds the configurable threshold, the taxpayer will receive an intimation and they can give details regarding the discrepancy in the form DRC-01B.
Earlier GST officers were instructed to seek details of all invoices on which ITC has been availed of by erring businesses in cases of mismatch in GSTR-1 and GSTR-3B before initiating recovery action for short payment or non-payment of taxes, increasing the chance of litigation.
The portal also provided a detailed manual to help taxpayers with the functionality with step-by- step instructions.
“This being a system-driven utility, would do tax payable comparisons on a realtime basis, ensuring maximum compliance with minimum governance,” Rajat Mohan, a partner at tax consultancy firm AMRG & Associates said.
“Defaulting taxpayers would be given an opportunity of being heard before issuing any tax demand,” he added.
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