Important To-Do’s for September 2019 (Financial Year 2018-19)

by | Sep 2, 2019

Though the current Financial Year (‘FY’) is third under GST regime, both the Government and taxpayers are still struggling to file Annual Return for first FY (FY 2017-18). Notably, September is an important month under the GST law from the perspective of several activities of preceding FY that needs to be completed by the due date of filing of return for September.

 

Through this update, we would like to highlight the various key aspects required to be undertaken by September 2019 in relation to FY 2018-19.

 

Sl. No.

Nature of Activity

Description

  1.  

ITC to be availed for FY 2018-19

Section 16(4) of the Central Goods and Services Tax Act (‘CGST Act’) provides that the last date to avail ITC, is earliest of following:

 

  • Due date of return under Section 39 for the month of September;
  • Filing of annual return

 

It is advisable that the taxpayers avail ITC for FY 2018-19 in GSTR-3B of September 2019 (to be filed by October 20, 2019) to avoid any disputes.

 

NITYA Comments: We have consistently taken a view that the last date to avail ITC is due date of filing of annual return as GSTR 3B is not a ‘return’ under Section 39 (For detailed analysis, refer our update ‘NITYA’s Outlook | Issue 30 | Time limit for taking Input Tax Credit pertaining to Financial Year 2017-18’ dated August 28, 2019). However, in order to avoid any dispute, taxpayers should endeavor to claim ITC in GSTR-3B of September 2019 itself.

 

  1.  

Issuance of debit notes / credit notes for price revision in FY 2018-19

Any credit notes related to invoices relating to FY 2018-19, can be issued up-to September 30, 2019.

 

 Pertinently, ITC on debit notes pertaining to invoices issued during FY 2018-19 can also be claimed by the due date of filing of return of September 2019 only. Hence, taxpayers should timely issue debit notes to ensure that there is sufficient time for their customers to avail credit.

 

  1.  

Re-availment of excess credit reversal under Rule 42 of the CGST Rules, 2017

Rule 42 of the Central Goods and Services Tax Rules, 2017 (‘CGST Rules’) provides for reversal of ITC on inputs and input services attributable to exempt supplies. The examples of exempt supply include sale of scrips, sale of old cars under margin scheme (where margin is negative), canteen recoveries (deemed as exempt supply) etc.

 

The reversal exercise is required to be done on monthly basis and the final amount needs to be calculated on yearly basis. If there is excess reversal of credit, such amount can be re-availed by the taxpayer by September of the next FY. Accordingly, the taxpayers need to finalize the reversal workings for FY 18-19 before September 30, 2019 and take re-credit (if any).

 

 

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