Reconciliation and Matching under GST

Reconciliation is a vital part of GST compliance. Reconciliation means matching data on the supplier’s end with the data on the receiver’s end. This process is crucial to ensure that no data about sales or purchase is reported wrongly while filing returns. 

The process of reconciliation ensures that you don’t face any unnecessary issues while claiming your ITC. If your data doesn’t match with that of your vendor’s data, you won’t be able to claim your ITC. 

The process of reconciliation is relatively brief and demands a lot of attention so that you do not miss out any vital entry!

In this piece, I will be discussing the Reconciliation process and how you can keep an eye on it.

Process of Reconciliation under GST

  • To begin with, it’s essential that you file your periodic GST returns on time. Without your regular returns, you can complete the process of reconciliation. This will result in the loss of the ITC that you are liable to avail. 

So, file your GST returns on time, and if you haven’t, then let us know, and we can help you with that. Apart from this, your books and your returns should be in perfect sync. So keep your books updated.

  • After you file your periodic return, begin with the process of reconciliation. Verify every entry in every error and every mistake in your accounts. If there is any discrepancy, correct it immediately.

If you find any errors in the current returns, you can do the necessary alterations. It’s vital to note here that there is no option to modify the returns of the previous period. But you can adjust errors in next GSTR3b or GSTR1 per the modifications you need. 

  • The next step is to match your GSTR3B data with the GSTR2A data uploaded by the supplier. As GSTR3B has to be uploaded every month, you can perform the reconciliation process smoothly.

The simple way to remove any possibility of mismatch in your GSTR3BB and your vendors GSTR2A is to hire an accounting agency.Such an agency can help you keep track of your accounts and will help you in claiming ITC. 

  • Maintaining sync between your accounts and your GST returns is very important. Establish a standard mechanism where you can communicate easily with your vendors before filing your returns. 

This will help you avoid any miss-match of data after the returns are uploaded on the portal from both sides. If you find any discrepancy, contact your vendor immediately and eliminate it.

With a robust communication and standard mechanism, you can reduce the risk of omission of entries, mismatch in data and any incorrect entries. If you find out that any of your vendors have missed some details, or is not staying compliant with them, pursue them to follow the process. This will help you optimize your ITC. 

This is a complex task, but you can simplify it by hiring a GST expert like Probal Consulting Group. Probal will handle all your GST compliance while you focus on your core business. 

  • Filing the September returns(GSTR-9) is extremely important. It is your last chance to report any alteration or corrections that you have made for any given financial year. If you fail to do so in September, you have missed the last train!

As I have explained earlier in this blog, if you have missed the last date for filing September return (GSTR-9), file it with applicable late fees. Because, without it, you won’t be able to avail maximum ITC. Moreover, if you have missed claiming your ITC during the period of a given financial year, GSTR-9 is your chance to avail it.

Closing remarks

After going through this article, I hope you have understood the importance of Reconciliation and Matching under GST. 

It helps you stay compliant, let’s you avail maximum ITC and saves your money! 

The key is to maintain your account books most efficiently. I have seen numerous business owners ignoring the importance of accounting and bookkeeping. But it’s not right. If you are doing so, you are losing a big chunk of your money in the form of ITC. 

So I strongly recommend you to hire an accountant, or better, outsource your accounting to experts. This will reduce your burden, improve your business efficiency & productivity, and you will save you a lot of money. 

Worried about Accounting and Bookkeeping?

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