– If there is any addition of Fixed Assets, ITC Availment on the same is to be ensured. Following the same will ensure timely discovering of non-compliances. IF WE DO NOT AVAIL THE ITC OF AND EXPENSE THE WAT AMOUNT WILL WE GOING TO TAKE IN BALANCE SHEET THE ONE WITHOUT GST OR INCLUDING GST. Verification of “place of supply” to check whether correct GST is charged – Verification is advisable mainly in cases where “Bill To” person is different than “Ship To” person. Though this is not a violation of the provisions, delay in claiming ITC which will increase net tax payment and interest thereon (This will have two types of interest payment – Interest to be paid for delay in payment of GST till date of payment & Interest to be paid to banks for OD availed for payment of GST). If we forget to mentioned reverse charge expenses in gstr-3B but same has been reflected in balance sheet. Reconcile Reconcile GST for each quarter or month to BAS Lodged Very good compilation of issues to be looked at while doing audit and finalization of accounts. Such recovery is to be treated as outward supply and GST is applicable at the appropriate rate. It will show the available results. VAT & GST TAX APPLICABLE FOR PROFIT & LOSS STATEMENT? In other words, ITC is available on all such goods / services which are used in the course of business except list of goods / services given u/s 17(5) of the CGST Act, 2017. – GST on transfer of Fixed Assets on which ITC is availed is covered under Schedule I of CGST Act (and hence even if the same made without consideration, will be termed as supply). Verification of “Other Income” ledger – It is advisable to go through every transaction reflected in “Other Income” ledger to confirm as to whether GST is applicable on any of such transaction for which tax invoice is not prepared. If GST on the same is charged by the lender, claiming of the same should be ensured. 2. – ITC on stock issued as free samples should be reversed. What about sale of company used car after 24/12/2017? Your email address will not be published. Why Reliance Retail acquired Future Group’s Retail business segment, AAR in case of M/s Pratham Agro vet Industries – GST Tariff on Rice Bran. Start with a Non-Cash GST report and the GST Figures should be the same as your Balance Sheet. Here it is asking you to choose the type of documents you wants to extract. Above procedures are not exhaustive and they just provide glimpse of procedures to be performed for ensuring compliance. If you did pay what was owed on the original return, create a Bill Credit using Receiver General as the Vendor and select your GST Liability account under the Account tab (not the Item) on the Bill Credit. books and other records maintained by the entity. As per Rule 37 of CGST Rules, Payment (along with tax) should be made to supplier within 180 days from date of invoice failing which warrants reversal of ITC along with interest. Logically value of outward supply should be matched and therefore, if there is any difference, then in that case, it would be advisable to rectify the differential value at the time of filing GSTR-1 / GSTR-3B for the subsequent month(s). It is seen that in few cases, companies have inadvertently not reduced GST liability and paid full GST amount as mentioned in tax invoice which has resulted in excess payment of GST. GST Audit involves verification various GST compliances w.r.t. 10. The balance sheet numbers are the same as the Sage GST efile numbers which result in a balance owing. – In case, any stock is written-off in books, GST reversal on the same should be ensured. It is seen that companies have claimed ITC on such services since tax invoices are booked and payment is made. In case, ITC is accumulated in books, we should ensure, – Whether application for refund can be made for the same (since accumulated ITC is not available as refund in all scenarios, – Whether refund application filed is in order with CGST Act & Rules thereon (like filing of application in time & all required documents are filed etc.). Sale of used cars – In case of sale of used cars, Compensation Cess was required to be paid apart from GST. 02. the input claims as per gstr 2/2a and 1 of supplier reveals huge gap whether the receiver of inward supplies can go ahead with gst inputs claimed as per suppliers bills irrespective of whether same is credited in gstin portal of not? 3. For example, transport expenses for GTA, legal expenses / professional fee for Legal service etc. For example, penalty / damages recovered etc. – In contracts involving heavy amounts / long period to complete, it is a practice of retaining some percentage of bill till contract term / warranty period. 4. We have a buy new car in exchange of old car. New TDS Rule, whether would be difficult to implement? In terms of the GST values on a Balance Sheet, the GST collected and GST paid can be almost equal amounts or significantly different values. Reconciliation of ITC credit ledgers & GST liability ledgers – Logically speaking, ITC closing balance as on 31st March 2018 should match with ITC balance reflected on GST portal under input tax credit ledger and cash ledger (like PLA balance). 102/21/2019-GST. What will be effect of gst, Think GST will not be applicable on Notice period recovery from Employee as it is not supply under GSt. (If you can’t take credit, then it would be an expense.) Thank you. Balance sheet is one of the important financial statement used for making business decisions. You have mentioned compensation cess is payable up to 24/12/2017 on sale of company used cars. In regards to Point sl no. Reconciliation of ITC credit ledgers & GST liability ledgers – Logically speaking, ITC closing balance … it is not clear from point on.1 above, whether on bhalf expenses and on behalf payments – inter company, intra company office/sites/factory in different states with different gst registrations – can that be treated as outward supply of services. For example, lease line expenses, rent, insurance etc. If you’re using Xero’s default chart of accounts, the GST account is 820 – GST. books and other records maintained by the entity. Budget 2021: A new condition introduced to avail Input Tax Credit. would attract GST. Various procedures to be verified in ensuring GST Law compliance w.r.t. In such a case, GST liability was required to be reduced at the time of raising tax invoice in the subsequent month(s). Admissibility of input tax credit (ITC) – While finalizing ITC, it is advisable to go through the “negative list” given u/s 17(5) of CGST Act, 2017. Recommended process includes : 1. Review GST Report for each quarter or month to ensure no change over the year 2. Stock as listed below: – Inter-state movement of the stock to distinct person is treated as supply and GST is leviable on the same. A balance sheet is also called as a top financial statement. Supply made without consideration is covered in Schedule I. Any constructive criticisms / corrections is always welcome. 13. Your guidance helps me to check and correct the issue in respect of turnover under GST being reported in filing annual return. ‘Total current assets’ has a GIFI code of 1599 and an associated balance of $25,855, which ties to our excel based balance sheet. In such a case, “place of supply” is location of the “Bill To” person rather than location of the “Ship To” person. Budget 2021: GST Audit by professionals scrapped? Set Off of Input Credit Against Out Tax Liability of GST. The GST Reports should not be moving once all data for a quarter has been entered and the Bank Accounts and Credit Cards entered. Excess input credit by default assumed to be an asset which can be used for set off in the future. Like the income statement, the balance sheet in the GIFI has shaded codes which are shown in black. Recovery from employees is treated as outward supply though it is not a sale transaction; c. In many cases, companies are charging GST on free samples / FOC supply which is not reported as sale; d. Any amount recovered from vendor on account of penalty is treated as outward supply though it is not a sale transaction. In such a case, company is required to classify such supply and GST rate pertaining to principal supply of goods or service. Unlike the Income Statement, which looks at company profitability, the balance sheet gives you a snapshot of your company's resources on a specific day. 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