{"id":4398,"date":"2018-11-23T12:45:05","date_gmt":"2018-11-23T07:15:05","guid":{"rendered":"https:\/\/taxclick.org\/?p=4398"},"modified":"2018-11-23T14:15:34","modified_gmt":"2018-11-23T08:45:34","slug":"reconciliation-annual-return-annual-financial-statement","status":"publish","type":"post","link":"https:\/\/taxclick.org\/type\/gst\/reconciliation-annual-return-annual-financial-statement\/","title":{"rendered":"Reconciliation Of GST Annual Return With Financial Statement"},"content":{"rendered":"<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The form of annual return does not require reconciliation with Annual Financial Statement (Balance Sheet and Profit and Loss Account) of taxable person for 2017-18. However, taxable persons whose aggregate turnover exceeds Rs. two crores in a financial year have to submit Audit Report in form GSTR-9C. This form is basically reconciliation statement which is required to be duly audited. The reconciliation is required with Annual Financial Statement of the taxable person.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The differences can be on many counts, including following \u2013<\/span><\/p>\n<p style=\"text-align: justify;\">\n<ul style=\"text-align: justify;\">\n<li><span style=\"font-size: 14pt;\">Annual Return in form GSTR-9 is for the period July 2017 to March 2018 while Annual Financial Statement (Balance Sheet and P&amp;L account) is for the period April 2017 to March 2018<\/span><\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li><span style=\"font-size: 14pt;\">Financial Statement will include income and expenditure other than as shown in Annual Return<\/span><\/li>\n<li><span style=\"font-size: 14pt;\">Provisions made at the end of Financial Year to comply with Accounting Standards.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Taxable Persons having aggregate turnover below Rs. two crores are not required to submit Audit Report. However, it is highly advisable they prepare and keep ready such reconciliation statement ready as these details may be asked during departmental audit or other audits.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\"><strong>MEANING OF AGGREGATE TURNOVER<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">&#8220;Aggregate turnover&#8221; means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">inter-State supplies of a person having the same Income Tax PAN, to be computed on all India basis and excludes taxes [CGST, SGST, UTGST and IGST] &#8211; section 2(6) of CGST Act.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">However, interest or discount received by him on deposits, loans or advances will not be considered for calculating aggregate turnover [though interest is exempted service] &#8211; Removal of Difficulties Order No. 1\/2017-CT dated 13-10-2017.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Since the term used is &#8216;value&#8217;, it should be without taxes.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">&#8220;Exempt supply&#8221; means supply of any goods or services or both which attracts <em>Nil <\/em>rate of tax or which may be wholly exempt from tax under section 11 of CGST Act or under section 6 of IGST Act, and includes non-taxable supply- section 2(47) of CGST Act.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">&#8216;Non-taxable supply&#8217; means a supply of goods or services or both which is not leviable to tax under CGST Act or IGST Act &#8211; section 2(78) of CGST Act.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">&#8220;Zero-rated supply&#8221; means a supply of any goods or services or both in terms of section 16 of IGST Act &#8211; section 2(23) of IGST Act.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Activities or transactions specified in Schedule III of CGST Act are to be treated as neither goods nor services. Hence, turnover of these will not be includible in &#8216;aggregate turnover&#8217;.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\"><strong>AUDIT REPORT IN FORM GSTR-9C IF AGGREGATE TURNOVER EXCEEDS RS. TWO CRORES<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Every registered person who is required to get his accounts audited in accordance with the provisions of section 35(5) of CGST Act shall furnish, electronically, the annual return under section 44(1) along with a copy of the audited annual accounts and a reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year with the audited annual financial statement, and such other particulars as may be prescribed &#8211; section 44(2) of CGST Act.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Every registered person whose aggregate turnover during a financial year exceeds two crore rupees shall get his accounts audited as specified under section 35(5) of CGST Act and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in form GSTR-9C<strong>,<\/strong> electronically &#8211; Rule 80(3) of CGST and SGST Rules, 2017.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The form GSTR-9C has been notified on 13-9-2018. The audit report is required to be filed along with annual return by 31-12-2018.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The audit of reconciliation statement can be conducted either by person who conducted the audit of annual financial statement of the company or by any other practicing CA\/CMA.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The details for the period between July 2017 to March 2018 are to be provided in this statement for the financial year 2017-18.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The reconciliation statement is to be filed for every GSTIN separately.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\"><strong>IF TOTAL TURNOVER OF PERSON EXCEEDS RS. TWO CRORES, AUDIT REPORT REQUIRED FOR EACH BRANCH\/DIVISION<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">The definition of &#8216;aggregate turnover&#8217; is clear that it includes turnover of a person having the same Income Tax PAN, to be computed on all India basis.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-size: 14pt;\">Thus, if a taxable entity having multiple GSTIN has aggregate turnover as per its Annual Financial Statement, separate reconciliation statement and Audit Report is required from each branch\/division\/factory even if aggregate turnover of such branch\/division\/factory is less than Rs. two crores per annum.<\/span><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The form of annual return does not require reconciliation with Annual Financial Statement (Balance Sheet and Profit and Loss Account) of taxable person for 2017-18. However, taxable persons whose aggregate turnover exceeds Rs. two crores in a financial year have to submit Audit Report in form GSTR-9C. This form is basically reconciliation statement which is &#8230; <a title=\"Reconciliation Of GST Annual Return With Financial Statement\" class=\"read-more\" href=\"https:\/\/taxclick.org\/type\/gst\/reconciliation-annual-return-annual-financial-statement\/\" aria-label=\"More on Reconciliation Of GST Annual Return With Financial Statement\">Read more<\/a><\/p>\n","protected":false},"author":309,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[15],"tags":[506],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Reconciliation Of GST Annual Return With Financial Statement<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/taxclick.org\/type\/gst\/reconciliation-annual-return-annual-financial-statement\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Reconciliation Of GST Annual Return With Financial Statement\" \/>\n<meta property=\"og:description\" content=\"The form of annual return does not require reconciliation with Annual Financial Statement (Balance Sheet and Profit and Loss Account) of taxable person for 2017-18. 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He is the regularly contributing for articles in various professional publications and newsletters, he has delivered various lectures on the topics of professional interest at various ICAI Seminars and other forums closely associated with Trade Associations, Colleges and Companies Knowledge sharing in the field of GST &amp; Start-ups.","url":"https:\/\/taxclick.org\/author\/yeshwant\/"}]}},"uagb_featured_image_src":{"full":false,"thumbnail":false,"medium":false,"medium_large":false,"large":false,"1536x1536":false,"2048x2048":false,"yarpp-thumbnail":false},"uagb_author_info":{"display_name":"CA Yashwant Kasar","author_link":"https:\/\/taxclick.org\/author\/yeshwant\/"},"uagb_comment_info":1,"uagb_excerpt":"The form of annual return does not require reconciliation with Annual Financial Statement (Balance Sheet and Profit and Loss Account) of taxable person for 2017-18. However, taxable persons whose aggregate turnover exceeds Rs. two crores in a financial year have to submit Audit Report in form GSTR-9C. This form is basically reconciliation statement which is&hellip;","_links":{"self":[{"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/posts\/4398"}],"collection":[{"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/users\/309"}],"replies":[{"embeddable":true,"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/comments?post=4398"}],"version-history":[{"count":0,"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/posts\/4398\/revisions"}],"wp:attachment":[{"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/media?parent=4398"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/categories?post=4398"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/taxclick.org\/wp-json\/wp\/v2\/tags?post=4398"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}