Matching of GSTR 2A with GSTR 3B

  1. 1. Need for matching of GSTR 2A with GSTR 3B
  2. 2. Invoice mismatch cases between GSTR 2A and GSTR 3B
  3. 3. How to reconcile GSTR 3B and GSTR 2A?
  4. 4. Why GSTR 2A reconciliation becomes important?
    1. What to reconcile?
    2. Why GSTR 2A reconciliation is needed?

1. Need for matching of GSTR 2A with GSTR 3B

The return in Form GSTR 2A is generated by the system on the basis on information received from GSTR 3B and GSTR 1 (sales details). When the supplier of the assessee files GSTR 1 in any particular month, its details are captured by GSTR 2A thus providing the details of purchases of the assessee concerned.

And since ITC claimed in GSTR 3B should ideally match with ITC available on all the purchases made by an assessee, a mismatch can be detected by comparing the details in these two forms which necessitates a reconciliation process between these two returns to be carried out.

2. Invoice mismatch cases between GSTR 2A and GSTR 3B

Invoice mismatch between GSTR 2A and GSTR 3B may arise due to one of the following reasons under stated:

Case 1 The supplier has not uploaded invoices for which the recipient have already claimed input tax credit by submitting the tax summary in his GSTR 3B return.
Case 2 On account of discrepancy of claim w.r.t., declaration by supplier in his valid return.
Case 3 On account of duplication of claim of ITC by recipient.  

3. How to reconcile GSTR 3B and GSTR 2A?

Mismatch Communication by GSTN Who has to rectify What action needs to be taken
On supplier failing to upload the invoice or on account of discrepancy with respect to the declaration by supplier in his valid return GSTR 1 To both supplier and Receiver Supplier has to rectify in GSTR 1 return Supplier shall be asked to rectify the discrepancy in his valid return for the month in which discrepancy is communicated.

When discrepancy is not corrected by the supplier:

If the recipient’s supplier does not rectify the discrepancy, the excess ITC claimed earlier shall be added to the output tax liability of the recipient in the next month
On account of duplication of claim of ITC by recipient To recipient alone. Recipient has to take action If a rectification is given effect, then no further action needs to be taken by the recipient.

When not rectified:

If a correction is not made, then the ITC claimed earlier shall be added to the tax liability of the recipient for the month in which duplication communicated

Notes to above table:

Note 1: Excess Input Tax Credit claimed is added to output tax liability in the succeeding month with interest at the rate not exceeding 18% on the amount added to the tax liability from the date of availing the ITC till the additions are made in returns.

Note 2: The facility to add missing invoice by supplier is not present as of today. The other option to take action against such missing invoice vesting in the hands of recipient in GSTR 2 is also unavailable since GSTR 1A which shows such changes to supplier made by recipient is absent from GSTN network.

4. Why GSTR 2A reconciliation becomes important?

  • What to reconcile?

    The reconciliation process primarily involves matching the data uploaded by the suppliers with those of the recipient’s purchase data. This includes comparing the auto populated GSTR 2A from supplier’s data and the purchase data recorded by the receiver of the supplies.

  • Why GSTR 2A reconciliation?

    It is very important to reconcile GST returns data because under the new GST returns, the taxpayers will only be able to claim ITC if the particular invoice is present in the GSTR 2A or supplier’s data. This situation forces the businesses to reconcile and claim ITC correctly.

    This matching concept also helps in verifying whether all the transactions which took place in a particular period have been recorded and posted in summary return GSTR 3B with correct values.

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