Goods and Services Tax (GST) was introduced by the Government of India to create a single unified indirect tax for the entire country. The Government has been taking continuous measures to simplify the process and plug the loopholes in the current structure.
GSTR-2B was recently introduced on a pilot basis to strengthen the process of availing Input Tax Credit (ITC) for the taxpayers.
In this article, you will find answers to questions like:
GSTR-2B is an auto-populated ITC statement which is generated for every registered assessee. The Central Board of Indirect Taxes and Customs (CBIC) has not formally issued any circular or notification for the introduction of GSTR-2B. However, a press release was issued by the Goods and Services Tax Network (GSTN) on 29 August 2020.
In simplest terms, GSTR-2B will help in determining the ITC that is available to an assessee. The data in this return is populated based on the GSTR-1, GSTR-5 (filed by non-resident taxable person) and GSTR-6 (filed by an Input Service Distributor ‘ISD’) filed by the assessee’s suppliers. Every assessee can view the GSTR-2B on their dashboard on the GST Portal.
Points to Remember
- The GSTR-2B is a static statement that is made available once a month to the assessee. It can be viewed on the 12th of the following month.
- It includes all information filed by suppliers/ISD in their Form GSTR-1, 5 & 6, between 12 AM on the 12th day of the preceding month and 11:59 PM on the 11th day of the current month. Thus, the statement generated on 12th of August 2020 will contain data from 12 AM on 12th July 2020 to 11:59 PM on 11th August 2020.
The main features of GSTR-2B are as follows:
The ITC is bifurcated into ‘ITC available’ and ‘ITC not available’. The data included under ‘ITC available’ in GSTR-2B is auto-populated in the GSTR-3B too. The data contained within ‘ITC not available’ may be due to instances like expiry of time limit to claim the ITC or IGST being incorrectly charged for an intra-state supply.
GSTR-2B contains the details of imports received from the ICEGATE system (Customs). This includes data on imports from units in Special Economic Zones (SEZ). However, this feature will be available in GSTR-2B from August 2020 (generated on 12th September 2020).
The details filed by respective suppliers in the prescribed returns would reflect in the next open GSTR-2B of the taxpayer, irrespective of the supplier’s date of filing. E.g., if a supplier files a document, say INV-1 dated 15 July 2020 on 11 August 2020, it will still get reflected in GSTR-2B of July (generated on 12 August 2020). However, if the same document is filed on 12 August 2020, it will be reflected in GSTR-2B of August (generated on 12 September 2020).
The details in the GSTR-2B can be viewed/exported at an individual invoice, debit note, and credit note level.
The summary of ITC also includes an option to display supplier-wise details every month.
The GSTR-2B includes advisories within every section of the return. By clicking on “View Advisory”, clarification is provided to the assessee on the actions to be taken in the respective section of GSTR-3B.
The summary in GSTR-2B can be viewed or downloaded in Excel or PDF format. The GST portal also allows the assessee to text search, filter, sort, and hide the generated data. An Email/SMS is also sent to the taxpayer informing the generation of GSTR-2B.
The differences noted between GSTR-2A and GSTR-2B are:
|ITC on Import of goods from units in SEZ||Does not reflect within the return||Reflects within the return under ITC Available tab – Part A (IV)|
|Availability of ITC claim||ITC is updated in the respective month of occurrence of the transaction when the supplier files their GSTR-1. Hence, ITC is to be claimed in the month of occurrence of the transaction.||ITC is frozen at the end of each month and, the transactions appear in the month of actual filing of GSTR-1 by the supplier. Hence, ITC of previous months, if any, can be claimed in the subsequent months.|
|Bifurcation of ITC||No such bifurcation||Bifurcated into ‘ITC available’ and ‘ITC not available’.|
|Nature of Return||Flexible and changes constantly||Static and remains fixed|
|Auto-populates from various sources||GSTR-1, GSTR-5, GSTR-6, GSTR-7, and GSTR-8||GSTR-1, GSTR-5, GSTR-6, and ICEGATE system|
As per the statement given by the GSTN, GSTR-2B is expected to reduce the time taken for preparing GSTR-3B, minimise errors, assist with GST reconciliation and simplify compliance relating to filing GST returns.
Taxpayers can efficiently perform reconciliation between the data generated in Form GSTR-2B and the books of accounts. Using this reconciliation, they can ensure that no credit is taken twice, credit is reversed as per law, and tax on reverse charge basis is correctly paid.
The linkage between the GST returns is expected to keep a check on tax evasion.
GSTR-2B is a welcome change to the existing GST system. The GST portal has currently enabled GSTR-2B for July 2020. Since the return is currently on a pilot basis, all taxpayers can provide their feedback, if any, by raising a ticket on the GST portal.