Different types of GST Audit (Blog)

An audit is a term that is commonly utilized for official assessment and review of docs by an Independent body, generally for financial records. Under GST, wherein a taxpayer is required to self-evaluate their tax liability, is frequently susceptible to mistakes, further prompting to unnecessary departmental interventions/litigations. An audit under such conditions can spare you the hassle.

Section 2(13) of CGST Act characterizes “Audit” as an assessment of records, returns and different docs kept up or outfitted by the enrolled individual under this Act or the guidelines made thereunder or under some other law for the present time in power to check the correctness of

  • turnover declared,
  • taxes paid,
  • discount claimed and
  • input tax credit benefited, and
  • to evaluate his compliance with the arrangements of this Act or the guidelines made there after;

Mainly, there are 3 kinds of audit as ordered by the GST law as given beneath:

Statutory Audit:

According to Section 35(5) of GST Audit rules, an enrolled taxpayer with a total turnover surpassing Rs. 2 crores in a financial year is required to get his account books and returns reviewed by an expert chartered accountant. A confirmed copy of these audited accounts and a compromise statement should be submitted in form GSTR 9C by means of the common gateway or through the Facilitation Centers as advised by the Commissioner

GST Audit Checklist

The approved CA will be required to check the below given details during the audit

  • GSTR 3B in connection to GSTR 1 and GSTR 2A
  • points of interest of invoice
  • ITC inversion for Non-installment
  • Coordinating EWB with the invoice
  • Stock pending with Job laborers
  • Yearly turnover according to audited financial reports
  • Compromise of ITC announced in the Annual Return (GSTR9) against the costs booked in the audited Annual Financial Statement or books of record.

Departmental Audit/Audit By Tax Authorities:

So as to guarantee an appropriate calculation and release of tax liability, the tax specialists have been approved to conduct an audit of the records kept up by the taxpayer. According to section 65 and Rule 101(3) of GST Audit Rules, the chief or an official approved by him can conduct an audit and confirm the details of the ‘records’ and the ‘books of account’ of the enrolled individual, alongside the help of the group of officials and authorities helping him.

Key Points

  • The audit will be led at the place of business of the enrolled individual or their enrolled office
  • A hint of the audit will be given minimum 15 days ahead of time in Form GST ADT-01
  • The audit is to be finished in 3 months from the date of initiation.

P.S: If GST officials are needing additional time, the Commissioner can expand the periodicity of the audit, by a further period not surpassing a half year.

Besides, upon the finish of the audit, the approved official will educate the discovering, rights and commitments and the reasons of the offered discoveries to the enrolled individual, inside a time of 30 days in FORM GST ADT-02. In case the enrolled taxpayer is found to blame, for example, wrongly profited/used ITC, the approved official can continue according to the technique set down under section 73 or Section 74.

Special Audit :

According to section 66 and Rule 102 of GST Audit Rules, an approved official (not beneath the position of Assistant Commissioner)at any phase of examination, enquiry or examination may benefit the services of a CA or CMA by considering the nature and unpredictability of the business and if the approved official is of the opinion that:

  • Worth has not been effectively announced; or
  • Credit profited isn’t inside the possible limits.

The approved official will give the direction for the audit in Form GST ADT-03, wherein the registered seller will be required to get his records including his books of accounts to be inspected and audited by the predefined professional CA or CMA inside a time of ninety days from the day of passing such a request.

Key Points

  • The cost of such unique GST audit and assessments is paid by the official.
  • The period required to review the account can be furnished with an expansion of extra ninety days.
  • By supply of the extraordinary GST review, the discoveries will be conveyed the auditee in Form GST ADT-04.

Enquire with Certicom Consulting in case of any queries.

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Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

Certicom Consulting

Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.