Essential Strategies for Monthly GST Compliance and Finalizing Your Books

GST Compliance

Strategies for Monthly GST Compliance and Finalizing Your Books

Key Points for Filing Monthly GST Returns and Finalizing Books of Accounts

GST Compliance

Reviewing Income for Outward Supply

Examine the credit side of your Trial Balance for any income that should be included in outward supplies, such as scrap sales or rental income.

Turnover Reconciliation

Ensure your turnover figures reconcile between GSTR 1, GSTR 3B, and your Books of Accounts. Investigate any discrepancies by scrutinizing invoice details.

Letter of Undertaking (LUT) for Exports

If you export goods or services without paying tax, make sure you have furnished a valid LUT for the financial year.

Purchase Reconciliation

Compare the purchases recorded in GSTR 2A and 2B with your Books of Accounts. Investigate any differences by verifying invoice details.

GST Compliance

Reverse Charge Mechanism (RCM)

Confirm that RCM has been correctly recorded and paid in cash for services like Goods Transport Agency (GTA) fees, legal fees, and director remuneration. Ensure GST is discharged on a reverse charge basis for services capitalized as part of an asset’s cost, especially when rendered by foreign entities.

GST on Advances for Future Services

Account for GST liability on any advance received for future services on the date of receipt. Verify that this has been included in GSTR 1 and GSTR 3B.

Reversal of Input Tax Credit (ITC)

Ensure ITC is reversed for:

  • Payments not made within 180 days
  • Blocked credits (e.g., Motor Vehicles, Insurance)
  • Invoices not received
  • Goods/services not received
  • Supplier’s return not filed
  • Place of supply rules
  • Time limitations (by 30th November)
  • Irrelevant invoices

Unbilled Revenue

Adjust unbilled revenue for services rendered in March according to AS-9 and the time of supply rule in GSTR 9C. Note that if the invoice is issued within 30 days, the supply is considered in April but recorded as unbilled revenue in March.

Goods in Transit

Claim input tax credit only when the goods are received by your business, as stipulated by section 16.

Handling Taxable and Exempt Supplies

If you provide both exempt and taxable supplies, apply the provisions of Rules 42 and 43. Banking companies can opt to avail 50% of the eligible ITC.

Forward Charge for Goods Transport Agencies

Ensure Annexure V is filed before the due date if Goods Transport Agencies pay GST under the Forward Charge Mechanism (FCM).

Disposal of Assets

Verify that the registered person has paid an amount equal to the input tax credit availed on disposed capital goods or plant and machinery, adjusted as prescribed or based on transaction value under section 15, whichever is higher.

Trade Receivables

For export services, ensure receivables in foreign currency are received within the stipulated period to meet export criteria.

GST Compliance

Trade Payables

For foreign creditors, especially service vendors, verify the impact of import services and ensure RCM is properly discharged. Reverse ITC if payment is not made within 180 days from the invoice date, providing necessary interest. Reclaim reversed ITC once payment is made.

Read More: Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Disclosure of GST Liability/Asset

Disclose excess input credit over output payable as part of other current assets, and excess output liability over input credits as other current liabilities. Make separate disclosures for CGST input credit and SGST payable, as they cannot be set off under GST laws.

By following these strategies, you can ensure GST compliance and maintain accurate financial records for your business.

Related Post

image

Essential Strategies for Monthly GST Compliance and Finalizing Your Books

Strategies for Monthly GST Compliance and Finalizing Your Books Key Points for Filing Monthly GST Returns and Finalizing Books of Accounts Reviewing Income for Outward Supply Examine the credit side…
image

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist ITR filing deadline: Unless the government grants an extension, people have until July 31, 2024, to file their Income Tax Returns (ITR).…
image

Tips for Smooth and Hassle-Free Income Tax Return Filing

Tips for Smooth and Hassle-Free Income Tax Return Filing Filing your income tax return is a vital part of managing your finances and requires careful attention. Follow these structured steps…

Book A One To One Consultation Now
For FREE

How can we help? *

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Income Tax Filing

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Income Tax Filing

ITR filing deadline: Unless the government grants an extension, people have until July 31, 2024, to file their Income Tax Returns (ITR). In order to prepare for filing, it is crucial to gather and arrange relevant papers, such as bank statements, prior tax returns, and wage or income records. The filing procedure differs based on the kind and source of income, which can include, but is not limited to, earnings from investments, business income, salaries, and other categories.

The criteria for ITR documents differ from person to person based on the tax filer’s income sources. Certain documentation, however, must be submitted by each taxpayer.

The list of typical ITR documents needed to file an ITR for FY 2023–2024 (AY 2024–25) is provided below.

1. PAN Card

A PAN card is crucial for filing ITRs. It is required for TDS deductions and must be linked to your bank account to receive direct income tax refunds. Issued by the Income Tax Department, PAN details can be found on various documents such as the PAN card itself, Form 26AS, Form 16, and Form 12BB. Recently, taxpayers have the option to file ITR using their Aadhaar instead of PAN.

2. Aadhaar Card

According to Section 139AA of the Income Tax Act, individuals must provide their Aadhaar card details when filing returns. If you don’t have an Aadhaar card but have applied for one, you need to provide the enrolment ID in your IT returns. Linking PAN with Aadhaar allows for online income tax return verification via OTP. The deadline for filing income tax returns for individuals is July 31st annually. Aadhaar cards, issued by UIDAI, can be easily downloaded online if lost or misplaced.

3. Form 16

Generated by employers, Form 16 is a summary of an employee’s salary details and the TDS deducted from it. It has two parts: Part A, which shows the employer’s tax deductions, PAN, and TAN details for the financial year, and Part B, which includes TDS calculations such as gross salary breakdown, exempt allowances, and perquisites. You can still file your ITR even if you don’t have Form 16.

4. Form 26AS

Form 26AS is a summary of the taxes deducted and paid by you, provided by the Income Tax Department. It includes details of tax deductions by deductors, tax deposits by taxpayers, and tax refunds received during the financial year. You can access this form on the Income Tax Department’s website.

5. Section 80C Investment Documents

Investments under Public Provident Fund (PPF), National Savings Certificates (NSC), Unit Linked Insurance Plans (ULIPs), Equity Linked Savings Schemes (ELSS), and Life Insurance Corporation (LIC) policies qualify for deductions under Section 80C of the Income Tax Act. Keep all relevant slips, receipts, and documents related to these investments for tax savings purposes. It is advisable to preserve these documents for a few years as a precaution.

Income Tax Filing

6. Other Required Documents

Ensure you have these documents or copies available for ITR filing:

  • Contribution to Provident Fund
  • Children’s school tuition fees
  • Life insurance premium payments
  • Stamp-duty and registration charges
  • Principal repayment on home loans
  • Equity Linked Savings Scheme/Mutual funds investments

The maximum deduction claimable under Section 80C is Rs 1.5 lakhs.

7. Bank Account Details

All current bank accounts must be disclosed in your income tax return. Include the bank name, account number, IFSC, and total number of accounts held. Designate one account as primary for tax refunds. Bank details are vital for verifying income disclosures and transactions, accessible via passbooks, statements, or online banking.

8. Annual Information Statement

The Annual Information Statement (AIS) provides taxpayers with a detailed overview of their information, similar to Form 26AS. Taxpayers can give feedback on the information displayed. The AIS includes both reported and modified values (after feedback) for sections like TDS, SFT, and other information.

9. Taxpayer Information Summary

The Taxpayer Information Summary (TIS) provides an aggregated summary of a taxpayer’s information. It includes processed and derived values under different categories such as Salary, Interest, and Dividend. This data is used for prefilling tax returns when applicable.

10. Home Loan Details

Home loan statements detailing principal and interest repayments are essential for tax filing. If you have a home loan from a bank, collect statements for the previous financial year.

Income Tax Filing

11. Stocks and Property for Capital Gains Tax

For sales of shares, securities, or property, documentation such as broker statements and property sale deeds is required to report capital gains or losses.

12. Dividend Income

Investors holding shares or mutual funds must report any dividend income when filing their income tax return. The specifics of the dividends received throughout the financial year can be obtained from broker statements or Demat account summaries.

Related Post

image

Essential Strategies for Monthly GST Compliance and Finalizing Your Books

Strategies for Monthly GST Compliance and Finalizing Your Books Key Points for Filing Monthly GST Returns and Finalizing Books of Accounts Reviewing Income for Outward Supply Examine the credit side…
image

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist ITR filing deadline: Unless the government grants an extension, people have until July 31, 2024, to file their Income Tax Returns (ITR).…
image

Tips for Smooth and Hassle-Free Income Tax Return Filing

Tips for Smooth and Hassle-Free Income Tax Return Filing Filing your income tax return is a vital part of managing your finances and requires careful attention. Follow these structured steps…

Book A One To One Consultation Now
For FREE

How can we help? *

Tips for Smooth and Hassle-Free Income Tax Return Filing

Income Tax Return Filing

Tips for Smooth and Hassle-Free Income Tax Return Filing

Income Tax Return Filing

Filing your income tax return is a vital part of managing your finances and requires careful attention. Follow these structured steps and guidelines to ensure a seamless and accurate process.

Gather All Income and Investment Documents

Collect all relevant information on your income sources, such as salaries, rental income, business profits, capital gains, and other income. Use documents like Form 16/16A, bank statements, interest certificates, and investment receipts. This thorough collection is essential for an accurate tax return.

Choose the Appropriate Tax Regime

Decide between the new and old tax regimes. The new regime is the default, but if the old regime benefits you more, file Form 10IE before submitting your tax return. Assess both regimes to determine the best option for your financial situation.

Match Incomes with 26AS and AIS

Download your Form 26AS and Annual Information Statement (AIS) and compare these with your compiled income details. Address any discrepancies by contacting the appropriate deductors. Aligning your records with the tax authorities’ data helps prevent issues.

Select the Correct ITR Form

Choosing the right Income Tax Return (ITR) form is crucial. Here are the seven forms and their eligibility criteria:

  • ITR-1: For resident individuals with income up to ₹50 lakhs from salary/pension, one house property, and other sources.
  • ITR-2: For individuals/HUFs with income over ₹50 lakhs, more than one house property, capital gains, other sources, foreign income/assets, and company directors.
  • ITR-3: For individuals/HUFs with income from business/profession where accounts are maintained or audited, and firm partners.
  • ITR-4: For individuals, HUFs, and firms with presumptive income, including incomes covered in ITR-1.
  • ITR-5: For firms, LLPs, AOPs, and BOIs.
  • ITR-6: For companies, except those claiming exemption under section 11.
  • ITR-7: For trusts, charitable/religious institutions, political parties, scientific research associations, and educational institutions.

Verify Personal Details

Ensure all personal information such as PAN, address, contact details, and bank accounts are accurate in the ITR form. Verify that your PAN and Aadhaar are linked to avoid any filing issues.

Provide Full and Accurate Disclosures

Declare all your incomes and claim only eligible deductions or exemptions. Avoid false claims. If your income exceeds ₹50 lakhs, complete the schedule of assets and liabilities. Also, disclose any foreign assets or company directorships as required.

Income Tax Return Filing

Include All Operative Bank Accounts

List all your active bank accounts in your ITR. Ensure that the bank account for refunds is pre-validated to prevent delays.

File Your ITR Before the Deadline

Avoid last-minute stress by filing your tax return well before the deadline. For individuals and non-audit cases, the deadline is 31st July 2024, and for audit cases, it is 31st October 2024. Late filing can result in penalties and loss of certain benefits, like carrying forward losses and claiming deductions.

Verify Your Filed Income Tax Return

After filing, verify your return within 30 days to ensure it is processed. Verification can be done through e-Verification or by mailing a hard copy to the Centralized Processing Center (CPC), Income Tax Department, Bengaluru. E-verification is recommended for quicker processing.

Related Post

image

Essential Strategies for Monthly GST Compliance and Finalizing Your Books

Strategies for Monthly GST Compliance and Finalizing Your Books Key Points for Filing Monthly GST Returns and Finalizing Books of Accounts Reviewing Income for Outward Supply Examine the credit side…
image

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist

Income Tax Filing (ITR) for AY 2024-25: Essential Documents Checklist ITR filing deadline: Unless the government grants an extension, people have until July 31, 2024, to file their Income Tax Returns (ITR).…
image

Tips for Smooth and Hassle-Free Income Tax Return Filing

Tips for Smooth and Hassle-Free Income Tax Return Filing Filing your income tax return is a vital part of managing your finances and requires careful attention. Follow these structured steps…

Book A One To One Consultation Now
For FREE

How can we help? *