You can avoid situations such as ITC reversal due to discrepancies or missed ITC claims by using the GSTR-2B reconciliation tool. Furthermore, when matching bulk transactions to claim the maximum allowable ITC, the tool can save time.
Normally, you must carefully match the data reported by your suppliers with your purchase documents, to avoid ITC reversal due to discrepancies in data reported by the supplier and receiver. Matching is also critical to ensuring that no ITC claims are overlooked and GSTR-2B reconciliation tool is needed.
The number of purchase documents can range from a few to thousands or even more, depending on the nature of the business GSTR-2B reconciliation tool is required. Even in a single document, there are numerous details such as Supply Location, Date, Reverse Charge Applicability, Total Value, and so on. All of these details must be thoroughly examined to avoid incorrect data reporting.
What is the GST Form ‘GSTR-2B’?
GSTR-2B was introduced after GSTR-2A, but it was intended to partially replace GSTR-2A. Although they may appear to be the same, GSTR2A and GSTR2B differ significantly.
GSTR 2B, as opposed to GSTR 2A, provides monthly eligibility and ineligibility for the input tax credit (ITC). However, it remains constant or unchanged throughout the period. This means that whenever a GSTR 2B for a given month is accessed on the official GST website, the data contained in it remains unchanged for future changes by their suppliers in subsequent months.
Every recipient can generate GSTR 2B using the GSTR 1, GSTR 5, and GSTR 6 forms provided by their suppliers. If you are a regular taxpayer or an SEZ taxpayer, you can obtain GSTR 2B.
The statement will clearly show your ITC eligibility details. ITC data collected here will cover the period from the filing date of GSTR 1 for the previous month (M-1) to the filing date of GSTR 1 for the current month.
GSTR 2B reports data in a way that allows taxpayers to easily and conveniently reconcile ITC with books of accounts and records. It also assists them in compiling all of the information.
It is important to take notice of the following key points in order to have an in-depth understanding of GSTR2B:
i) GSTR2B is a monthly statement generated automatically;
ii) The GSTR-2B for the recipient is generated based on the information provided by the supplier in their GSTR-1, GSTR-5, or GSTR-6;
iii) In contrast to the GSTR-2A form, GSTR-2B is a read-only statement that taxpayers cannot edit;
iv) GSTR-2B is only available after the 12th of each month; and
v) GSTR 2B is available in Excel and JSON formats for download.
GSTR-2A vs. GSTR-2B : Difference Factors
In the following sections, we have highlighted ‘What are the differences between GSTR2A and GSTR2B?’. You will also understand the critical differences between GSTR2A and GSTR2B and which one you should use as a taxpayer:
|GSTR 2B||GSTR 2A|
|Based on data from the supplier, each recipient of supplies receives a consistent auto-drafted statement that includes the input tax credit (ITC) for each tax period.||It is an automatically generated progressive statement for each recipient of supplies that shows ITC details based on the suppliers’ data, including any changes made later.|
|Nature of the Statement:|
|It has a static nature.|
This means that GSTR 2B does not change for any given month, regardless of the supplier’s subsequent actions.
|It has a dynamic nature.|
This means that it changes daily based on the documents provided by the supplier.
|GSTR 1 (Invoice Furnishing Facility), GSTR 5, and GSTR 6 (Indian Customs EDI System).||GSTR 1 (Invoice Furnishing Facility), GSTR 5, GSTR 6, GSTR 7, GSTR 8, and the Indian Customs EDI System.|
|ITC Claim Advisory:|
|Under each section, the taxpayer is given guidance on whether an ITC is eligible, ineligible, or reversed. This allows them to proceed with their GSTR 3B as planned.||There is no information here about what a registered buyer must do.|
|When ITC entries are transferred from their sources:|
|GSTR 1, GSTR 5, or GSTR 6 forms are submitted.||When GSTR 1 is saved or sent.|
When GSTR 6 is filed.
When GSTR 7 and GSTR 8 are submitted.
|Last day to view the statement for a given period:|
|It is usually the 11th or 13th of the following month.|
The Statement is generated on the 14th of the month following.
|Because it is a dynamic sheet, the last date is irrelevant.|
|The maximum number of ITC entries can be viewed without requiring an Excel download from the GST website:|
|Without having to download an excel sheet, 1000 rows can be viewed.||Without having to download an excel sheet, 500 rows can be viewed.|
Manually comparing these details becomes impossible as the number of purchase documents grows. That is why GSTHero includes auto-matching functionality, which compares thousands of documents in seconds and displays the results so you can take appropriate action on any differences.
Overall, the ‘GSTR-2B reconciliation tool’ is useful for reconciling and claiming the maximum ITC. However, whether using GSTR-2A or GSTR-2B, reconciliation remains the same. Both forms require you to manually match the details as instructed in the GSTR-2B notification.
The only distinction between GSTR-2B and GSTR-2B in GST is that the ITC data will be separated into a more organised return report.
For a better reconciliation with both GSTR-2A and GSTR-2B, you will need the assistance of some advanced and high-tech solutions to make the reconciliation simpler and more effective in order to claim maximum ITC.
GSTHero offers the best GSTR-2B reconciliation tool experience with its feature-rich Advanced Reconciliation Tool, which is the best solution on the market for this purpose.
|Author Bio: GSTHero|
GSTHero India is a provider of GST filing and E-Way Bill generation software. GSTHero, an authorised GST Suvidha Provider, assists businesses and tax practitioners with GST Compliance, E-Invoicing Integrated Solution, and E-Way Bill Automation.