The annual return in Form GSTR-9 for the FY 2018-19 is to be filed by 31st October,2020. In this article we shall discuss about how the inter year adjustments in regard to output liability and input tax credit needs to be dealt with in GSTR-9. In this regard there may be three broad situations. Let us discuss the treatment of each of the situation while filing GSTR-9 for FY 2018-19.
1. Adjustments in output tax liability / Input Tax credit pertaining to FY 2018-19 reported in GSTR-3B of FY 2019-20.
There may be situations where output tax liability and / or Input Tax Credit is over / under reported while filing GSTR-3B for the FY 2018-19. As there is no provision for revision of GSTR-3B under GST Law, the only option left is to make suitable adjustments of above error and omissions while filing GSTR-3B of next year viz 2019-20.
Suppose over / under reporting of output tax liability / ITC for FY 2018-19 has been fully corrected in GSTR-3B of FY 2019-20. Now question arises as to how such adjustments would be reported in GSTR-9 of FY 2018-19.
In this regard the answer is quite simple that such adjustments needs to be reported in Table 10 to Table 14 of GSTR-9 of FY 2018-19. Under Table 10 increase in output liability is disclosed whereas Table 11 is for reduction in output liability i.e. where in GSTR-3B for FY 2018-19 excess output tax liability was disclosed and tax paid.
Similarly in cases of reversal of excess ITC availed during 2018-19, in GSTR-3B of 2019-20, such reversal is to be disclosed in Table 12 of GSTR-9 of FY 2018-19. ITC less availed in FY 2018-19 and availed in GSTR-3B of 2019-20 should be reported in Table 13 of GSTR-9 for FY 2018-19.
It may be noted that taxable turnover for FY 2018-19 to be reported in GSTR-9 of FY 2018-19 will equal to Table 4 + Table 10 – Table 11. Further the ITC for FY 2018-19 will be equal to Table 6 -Table 7 + Table 13 – Table 12 of GSTR-9 of said year.
2. Adjustments in output tax liability / Input Tax credit pertaining to FY 2018-19 not reported in GSTR-3B of FY 2019-20.
There may be cases where there is over / under reporting of output tax liability and / or Input Tax Credit while filing GSTR-3B for the FY 2018-19 and same have also not been reported in GSTR-3B of next year viz 2019-20.
In case of under reporting of output tax liability or over reporting of Input Tax Credit , correct figures (after adjusting such omissions/ adjustments) should be disclosed in Table 4 and 6 ,7 of GSTR-9 and amount of tax payable thereon should be paid through DRC-03.
In case of under reporting of ITC nothing can be done now as credit towards invoices for FY 2018-19 cannot be availed at this juncture in light of Section 16(4) of the CGST Act, 2017.
3. Adjustments to Output tax liability / Input Tax credit pertaining to FY 2017-18 reported in GSTR-3B of FY 2018-19.
As discussed supra, the adjustments to Output tax liability / Input Tax credit pertaining to FY 2017-18, reported in GSTR-3B of FY 2018-19 must have been disclosed in Table 10 to Table 14 (Part V of GSTR-9) while filing the annual return for FY 2017-18.
The question here arises is whether in Table 4 (output tax liability) or Table 6 , 7 (Input Tax Credit) of annual return of FY 2018-19, the figures to be depicted should include the figures of FY 2017-18 which have been reported in GSTR-3B of FY 2018-19 or not.
In this regard the taxpayers were facing issue as the auto-populated GSTR-9 for the year 2018-19 (Tables 4,5,6 and 7) also includes the data for FY 2017-18 reported in GSTR-3B of FY 2018-19. However, this information for FY 2017-18 has already been furnished by tax payers in the annual return GSTR-9) filed for FY 2017-18 and there is no mechanism to show the split of two years (2017-18 and 2018-19) in FORM GSTR-9 for 2018-19.
CBIC Clarification:
Considering the issue being faced by tax payer in regard to disclosure of inter year adjustment in GSTR-9, CBIC has issued a clarification vide press Release dated 9th October, 2020 which is reproduced below:
It is clarified that the taxpayers are required to report only the values pertaining to Financial Year 2018-19 and the values pertaining to Financial Year 2017-18 which may have already been reported or adjusted are to be ignored. No adverse view would be taken in cases where there are variations in returns for taxpayers who have already filed their GSTR-9 of Financial Year 2018-19 by including the details of supplies and ITC pertaining to Financial Year 2017-18 in the Annual return for FY 2018-19.
As per above clarification the Outward liability or Input tax credit pertaining to F.Y. 2017-18 reported in GSTR-3B of F.Y. 2018-19 should be excluded by the taxpayer from the auto populated figures in respective Tables 4,5,6 & 7 of GSTR-9 for FY 2018-19.
Difference in tax payable and tax paid:
It is important to note here that due to exclusion of 2017-18 figures from table 4 of GSTR-9 of FY 2018-19 , difference will arise between Table 9 (tax paid) of GSTR-9 of FY 2018-19 vs. Tax payable for FY 2018-19. This difference is due to fact that 2017-18 figures reported in 2018-19 have been excluded, however the tax paid (through GSTR-3B) figures includes the tax paid for 2017-18.
In this regard we should check that a difference between tax payable and tax paid should be equal to inter year adjustments (Table 10 – 11) of GSTR-9 of previous year or tax payable through DRC-03 (being discussed later).
The position can be appreciated by following tables:
A. Inter year adjustment of Outward Liability: Difference in Table 9 (Tax Payable vs. Tax paid)
| Particulars | GSTR-3B | Table 4 of GSTR-9 (Tax on Taxable Outward Supplies) | Table 9 (Tax Payable) | Table 9 (Tax Paid) |
| IGST for F.Y. 2018-19 | 1200* | 1000 | 1000 | 1200 |
*includes Rs 200 IGST liability for F.Y. 2017-18 reported in GSTR-3B of F.Y. 2018-19 and also reported in Table 10 of GSTR-9 of F.Y. 2017-18.
In this case while reporting figure in Table 4 we shall exclude earlier year figure and thus will report tax of only Rs 1000/-. However as the actual tax paid amount is Rs 1200/- via GSTR-3B , which cannot be edited by us. A difference of Rs 200/- will arise.
When we reconcile the difference between tax paid and payable and difference should be equal to inter year adjustments (Table 10 – 11) of GSTR-9 of FY 2017-18 as in the instant case the difference of Rs 200 is pertaining to IGST liability reported in Table 10 of GSTR-9 of FY 2017-18, the difference can be said to be reconciled and GSTR-9 can be filed accordingly.
B. Inter year adjustment of Input Tax Credit :Difference in Table 6J ( ITC availed as per 3-B vs ITC availed as reported in GSTR-9)
Due to exclusion of ITC figures of FY 2017-18 (reported in GSTR-3B of FY 2018-19) from table 6 difference will arise in Table 6J as the amount of ITC availed as per 3B as auto populated at Table 6A will include the 2017-18 figures. However the data of ITC availed as reported in table 6B to 6H and sub-total at 6J will exclude 2017-18 figures in view of CBIC clarification. Thus there will be difference to the extent of figures reported in Table 12 and 13 of GSTR-9 of FY 2017-19.
For ease of understanding please refer to following illustration:
| Particulars | Table 6A of GSTR-9(Auto-populated) | Table 6I(Total ITC availed) | Table 6J(6I -6A) |
| ITC for F.Y. 2018-19 | 600* | 500 | -100 |
*includes ITC for F.Y. 2017-18 reported in GSTR-3B of F.Y. 2018-19 and reported in Table 13 of GSTR-9 of F.Y. 2017-18.
In this case while reporting figure in Table 6B to 6H (total of which is captured in 6I) we shall exclude earlier year figure and thus will report ITC of only Rs 500/-. However the figure in 6A is auto populated from GSTR-3B and cannot be edited, wherein an amount of Rs 600/- will be depicted. Thus a difference of Rs 100/- will arise.
As the difference of (-) Rs 100 is towards the ITC of 2017-18 and is reconciled there is no cause of concern and GSTR-9 can be filed. If reason for difference is asked for by the Deptt. in future they may be provided with the reconciliation stating that 2017-18 figures were not included in 2018-19 return, as per CBIC Press Release.
If difference is not reconciled there may be other reasons like payment of tax under DRC-03 is to be made etc.
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Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.
