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4 BIG COMMON Mistakes in GSTR- 3B

4  BIG COMMON Mistakes People making in GSTR- 3B 
( & that leads to wrong reporting in GSTR 9 
4  BIG COMMON Mistakes in GSTR- 3B.After filling some Annual return GSTR 9, WE have found that ,   many people are making following 4 mistakes in day-to-day accounting. That leads to wrong reporting in GSTR 3B & then leads to wrong reporting in GSTR 9 . Mind well , If you want to file GSTR 9 quickly then file GSTR 3B perfectly every month . This Basic 4 problems first need to be addressed & solved then only , You will have seamless & error free filling in GSTR 9 . If GSTR 3B is error-free , Your GSTR 9 is Error-free & less time consuming
 
 
1. OUTWARD SIDE  
1.1  FORGOTTEN INCOMES  –     PLEASE UNDERSTAND THAT NOW almost EVERY INCOME is under RADAR of GST.  MAJORITY PEOPLE COMMIT MISTAKE BY NOT CHARGING GST ON FOLLOWING INCOMES.
 
   1.  RENT ON COMMERCIAL PROPERTY ,   
   2.  FREIGHT CHARGED BY SUPPLIER ON GOODS SOLD
   3.  COMMISSION INCOME . 
 
please note that all these incomes need to be GST levied.. If you have forgot to collect GST on  these incomes   in FY 17-18 , 18-19 , 19-20 THEN PLEASE PAY GST TO GOVT. 
 
1.2  PURCHASE RETURN SHOWN AS SALES IN OUTWARD – You cannot show this in GSTR 3b as  “SALES”. You have to reduce ITC in GSTR 3B .  I have discussed this in detail in 4th point
 
 
2. RCM SIDE – 
Many people are not paying RCM . Reverse Charge GST is normally charged on following  . You have to pay this in cash & you can claim ITC of RCM in majority case           
 
1.  TRANSPIRATION / FREIGHT   ( WHETHER ON INWARD OR OUTWARD  )        2.  ADVOCATE FEES              3. SECURITY SERVICES  
 
please note that on  all these EXPENSES , You  need to pay RCM to Govt. .. If you have forgot to pay  GST on  these EXPENSSES   in FY 17-18 , 18-19 , 19-20 THEN PLEASE PAY GST TO GOVT.   
 

3. ITC SIDE –  

3.1. If you have CLAIMED wrong ITC of FMCG PE  ” FOOD & BEVERAGES  |     MOTOR CAR IF less THAN  13 PERSONS  |  construction   |   Goods Destroyed/lost   |  Personal Expenses   |     Exempted Goods Manufactured   then you need to reverse it. People Forget to reverse

IF they have claimed any ITC on any such blocked

3.2. Sale return shown as Purchase & Thereby claiming wrongly ITC on it –   You cannot show this in GSTR 3b as  “INWARD”. You have to reduce sales in GSTR 3B .. Discussed this in 4th Point

4 .   CREDIT NOTE / DEBIT NOTE 

Biggest mistake , People are making that  For Sale side credit note ( i.e sale side reduction/ sales return ) , You have claimed it in Purchase & thereby claiming ITC. Instead of Reducing Sale side liability.  Mind well , You are doing wrong . 

What is right approach ?? In GST , Any sale side reduction , Seller should issue Credit Note & he should reduce his Outward Tax

    LET’S make it clear that Only SUPPLIER ( I. E SELLER ) has to issue CREDIT NOTE / DEBIT NOTE when sales amount gets changed or sale return 

Credit note  or  Debit Note
GSTR-1 which you send , We are finding lot many mistakes in GSTR-1 particularly for Credit Note – Debit Note  . Please feel free to ask me anytime to learn about CN-DN .  Hereby , I am writing detailed explanation once again for Credit note / Debit Note .
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Firstly ,  keep in mind that only seller need to make Credit Note – debit note (& never Purchaser).Both Debit Note or Credit note need to be prepared only by Supplier (seller).  (whenever there change (+/-) in Sales invoice).

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What is Debit Note? 
A debit note in GST, is a document issued by the supplier in the following cases:
·        +Increase in Taxable Value -When a supplier requires to increase the taxable value of a supply, he/she has to issue debit note to the recipient.
·        +Increase in GST charged in invoice – When a supplier requires to increase the rate or value of GST charged in an invoice, he/she has to issue debit note to the recipient.
The issuance of a debit note or a supplementary invoice creates additional tax liability. The treatment of a debit note or a supplementary invoice would be identical to the treatment of a tax invoice as far as returns and payment are concerned.

in GSTR 3B , SALE SIDE ( OUTWARD SIDE ) LIABLITY WILL Increase
in GSTR 1 , show this in CDNR sheet – as credit note – Type  “D”


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What is Credit Note? 

A credit note in GST, is a document issued by the supplier in the following cases:
·        -Supplies are returned or found to be deficient by the recipient – When goods supplied are returned by the recipient or goods/services supplied are found to be deficient by the recipient, the supplier should issue a Credit Note. The credit note serves the purpose of reducing the value of the original supply.
·        -Decrease in taxable value – When a supplier requires to decrease the taxable value of a supply, he/she has to issue a credit note to the recipient.
·        -Decrease in GST charged in invoice – When a supplier requires to decrease the rate or value of GST charged in an invoice, he/she has to issue a credit note to the recipient.

in GSTR 3B , SALE SIDE ( OUTWARD SIDE ) LIABLITY WILL REDUCE
in GSTR 1 , show this in CDNR sheet – as credit note – Type  “C”
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You have to think Other way round , If you have made Purchases and thereafter any Price revision or Purchase Goods return happened.

FOR PURCHASE DECREASE OR GOODS RETURNED BY YOU –   REDUCE ITC in GSTR 3B  I.E INWARD SIDE EFFECT…..   ( NO EFFECT IN GSTR 1)

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