After Jul-2017 when GST was rolled out for the first time in India since then It has been noted that everyone struggling to file GST return whether they are normal Tax Payer, Consultant or anyone. GST Council continuously putting effort to improve GST return process, so keeping this mind government is about to launch new mechanism of GST Return from 1st Apr 2019 on trial basis(It was about to launch on 1st Jan 2019) later on it will be on live from 1st July 2019.
This article will help you to understand the process of filing GST return under new mechanism.
“Upload” under New GST Return
Under new GST Return upload means uploading outward Invoices by supplier of goods or services. Supplier will have option ot upload their invoice on daily basis or anytime as per their availability. As soon as invoices will be uploaded on GSTIN it will be visible to recipient instantly.
In simple words Supplier Uploads Invoice on GSTIN can be seen by buyer instantly.
“Locking” under New GST Return
Once Invoices uploaded by supplier can be visible to buyer and next step is to lock the invoice by buyer. Locking of Invoice can be done by buyer depending on scenario and there several option available to lock Invoice such as “Accept(Lock)”,”Pending”, “Reject”.
Accepting(Lock)
Locking of Invoices means action taken by buyer on invoices uploaded by supplier. While reviewing Invoices if buyer find all ok he or she can lock invoice. Buyer will be eligible to get Input tax credit for those invoices only where Invoices uploaded and lock by buyer on GSTIN portal. If buyer does not lock or accept the invoice he or she will not be eligible for ITC. Locking need to be done on or before filing of GST Return. Locking invoices one by one is huge task hence there is additional optional available as deemed locking under which all those invoices which are not marked as Pending or rejected will be treated as lock by buyer automatically at time of filing GST Return.
E.g: For the month of Apr-2019 there are 500 Inward Purchase Invoices are there and it is very tough to review all invoices hence we can check out only those Invoices which need to be marked as pending or reject once pending or reject marking done then after balance invoices can be automatically accepted as lock by GSTIN system automatically.
This article will help you to understand the process of filing GST return under new mechanism.
“Upload” under New GST Return
Under new GST Return upload means uploading outward Invoices by supplier of goods or services. Supplier will have option ot upload their invoice on daily basis or anytime as per their availability. As soon as invoices will be uploaded on GSTIN it will be visible to recipient instantly.
In simple words Supplier Uploads Invoice on GSTIN can be seen by buyer instantly.
“Locking” under New GST Return
Once Invoices uploaded by supplier can be visible to buyer and next step is to lock the invoice by buyer. Locking of Invoice can be done by buyer depending on scenario and there several option available to lock Invoice such as “Accept(Lock)”,”Pending”, “Reject”.
Accepting(Lock)
Locking of Invoices means action taken by buyer on invoices uploaded by supplier. While reviewing Invoices if buyer find all ok he or she can lock invoice. Buyer will be eligible to get Input tax credit for those invoices only where Invoices uploaded and lock by buyer on GSTIN portal. If buyer does not lock or accept the invoice he or she will not be eligible for ITC. Locking need to be done on or before filing of GST Return. Locking invoices one by one is huge task hence there is additional optional available as deemed locking under which all those invoices which are not marked as Pending or rejected will be treated as lock by buyer automatically at time of filing GST Return.
E.g: For the month of Apr-2019 there are 500 Inward Purchase Invoices are there and it is very tough to review all invoices hence we can check out only those Invoices which need to be marked as pending or reject once pending or reject marking done then after balance invoices can be automatically accepted as lock by GSTIN system automatically.
Important to Note : Once Invoice is locked by buyer can not be amended by supplier. Supplier need to raise credit or debit note to revised Invoice. In case buyer wrongly locked the Invoice then it can be re-open or unlock by buyer only.
Example: ABC Company uploaded outward Sales Invoice to XYZ Company. XYZ Company can view the invoice and lock it. Once XYZ locked the Invoice now ABC Company can not make any changed on Invoice on GSTIN but still he need to do then he can ask to XYZ to unlock the Invoice before filing GST Return.
Reject
While buyer review invoice which are uploaded by supplier and came to know that few Invoices which are uploaded does not belongs to buyer where wrongly buyer GSTIN has been entered hence its buyer can not lock such invoice and claim ITC hence it is responsibility of buyer to mark it reject. In case buyer missed to mark reject and filed GST return then it will be treated as deemed Locked.
Pending
Pending of Invoices can be marked by buyer in different scenario as follow
a. when supply of goods or service has not been received by buyer.
b. When buyer thinks invoices is not proper and correction need to be done.
c. When buyer is not sure to claim ITC and want to keep on hold for next month.
Buyer can not availed Input Tax Credit on those Invoices which are marked as pending. It is important to know that marking pending Invoices is only available for those who have opted for monthly return filing and not for others.
Pay under New GST Return Filing Process
Under new GST Return filing process payment is being done at same time of filing returns.It gets completed when supplier and buyer both upload their Invoices and lock inward invoices. Earlier ITC was based on self declared valued under GSTR3B now ITC will be auto populated based on invoices uploaded by supplier and locked by buyer. Liability will auto arise after consider ITC based on locking of Invoice where Buyer will come to know the amount of liability to be paid. Hence major part will be auto reflected and need not to put efforts to file multiple return form.
Hence, the new GST return filing process aims towards simplification of GST Return for Tax payers with the new feature of continuous locking of invoices by buyers. Now under new method Buyers will not need to wait for the supplier to file their return to know whether the supplier has uploaded their invoice. Along with deemed locking option is also available to ease the life of tax payer for reconciliation of Invoices.
Problems under New GST Return: Even though GST Council trying best to make it more easy but there may be some concern which need to be addressed
- Locking of Invoice is quite big task in case of limited inward supply there won’t be concern but in case of maximum Inward Invoice buyer has to reconcile each invoice to either lock it or mark as pending/reject.
- It is tough to reconcile Inward supply on daily basis.
- In case supplier does not upload invoice till return or daily basis then ITC can be missed by buyer.
- In case of buyer file monthly return and supplier upload quarterly return then how buyer will not be able to lock invoice as it will not reflect on GSTIN
- There are chances there will be mismatch of books of accounts. Example if buyer has recorded 100 purchase invoices for the month but supplier has uploaded only 95 and will be able to lock only 95 Invoices where as 5 Invoice excess in books will not be able to match ITC on return.
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I hope there may be alternate solution and definitely council will work on the same. GST Council are trying there level best to make it user friendly.
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