Head wise Checklist for GST audit
Head wise Checklist for GST audit
This article will discuss about Head wise Checklist for GST audit. It is about verification of correctness of turnover, taxes paid, ITC and refund. It also includes the verification of compliances of other provisions. I this article we will focus on second part of GSTR 9C. It covers the certification part. Every head covered in definition of audit is covered here.
Definition of audit in GST provide for verification of following items:
i. Turnover
ii. Input Tax credit
iii. Taxes Paid
iv. Refunds
v. Compliance with other provisions of Act
Head wise Checklist for GST Audit: Turnover
- Total turnover booked in books of accounts:
The turnover booked in books of accounts and turnover declared in returns for payment of tax will be covered in reconciliation part. Apart from reconciliation following matters should be looked upon by auditor.
|
Sl. No. |
Nature of discrepancy |
Information required |
Relevant provisions to be referred |
|
1. |
Turnover is allocated in wrong HSN or tax rate |
A note on nature of outward supply including its classification |
Notification No. 1/2017 CTR Notification No. 2/2017 CTR Notification No. 11/2017 CTR Rules of Harmonized construction. |
|
2. |
Domestic turnover is booked as export: 1. Goods 2. Services |
– Export of goods can be verified from shipping bill and invoice – Services export need to qualify 5 conditions. – Take a note on flow of transaction in case of services – Check BRC/FIRC for services |
Advance ruling: Segoma Imaging technologies (for export of services. |
|
3. |
Taxable supply is booked as exempted |
HSN rules 2/2017 CTR 12/2017 CTR |
|
|
4. |
Charitable entities registered u/s 12 A of Income tax Act |
Notification no. 12/2017 CTR Take a copy of agreement to see whether it is a donation or its receipts will fall in consideration |
Check definition of “Charitable activities” in said notification. |
|
5. |
Educational institutions |
Entry No. 66 of 12/2017 CTR Exemption is only from pre education to higher secondary. Entry No. 67 covering IIM’s |
All other education services like coaching (even if it is for free is taxable) Pls check relevant entries. |
|
6. |
Hospitals |
12/2017 CTR, Entry No. 74 exempts services by a clinical establishment, an authorized medical practitioner or para medics. It also includes ambulance services. |
Head wise Checklist for GST Audit: Input Tax Credit
|
Sl. No. |
Nature of discrepancy |
Information required |
Relevant provisions to be referred |
|
1. |
ITC is taken without fulfilling all four conditions |
– Relevant Document – Receipt of Goods/ services – Returns are filed by both supplier and recipient |
Section 16(2) of CGST Act |
|
2. |
Reversal required u/s 17(1), 17(2) are not made |
Calculation sheet for reversal of section 17(1) &(2) read with rule 42 & 43. |
Section 17(1), (2), (3), Rule 42,43. |
|
3. |
Input tax credit blocked u/s 17(5) |
List of ineligible ITC as per management. |
Section 17(5) |
Head wise Checklist for GST Audit: Taxes Paid
|
Sl. No. |
Nature of discrepancy |
Information required |
Relevant provisions to be referred |
|
1. |
Tax paid in wrong head |
A note on determination of PoS for various outward supplies. |
Section 10,11,12,13 of IGST Act. |
|
2. |
When return is not filed on time |
Date of filing of GSTR 3B & GSTR 1 for each month. Calculation of interest in each case when GSTR 3B is filed late. Calculation of late fees for each case when GSTR 3b and GSTR 1 is filed late. |
Calculate interest and late fees for each month for late filing. |
Head wise Checklist for GST Audit: Refunds
|
Sl. No. |
Nature of discrepancy |
Information required |
Relevant provisions to be referred |
|
1. |
Calculation of refund granted |
– Take copies of application and order from department. – Check calculation of all refunds. – Check conditions for export of services |
Section 54 of CGST Act, Section 16,12,13 of IGST Act. Advanced ruling of Global reach education services & Segoma Imaging technologies |
CA Shafaly Girdharwal
CA
New Delhi, India
CA Shaifaly Girdharwal is a GST consultant, Author, Trainer and a famous You tuber. She has taken many seminars on various topics of GST. She is Partner at Ashu Dalmia & Associates and heading the Indirect Tax department. She has authored a book on GST published by Taxmann.
