The Central Goods and Services Tax – 5th Amendment Rules, 2022 were published by the Central Board of Indirect Taxes and Customs in GST Notification No. 26/2022 – Central Tax dated December 26, 2022.
Let us discuss five important changes in the 5th Amendment Rules under GST in this article.
1. Amendment in Rule 8 Sub- Rule 1 (Application for GST registration)
Before applying for GST registration, in Part A of FORM GST REG-01 on the common portal, declare Permanent Account Number, Requirement of declaration of mobile number, e-mail address omitted in Part A of Form GSTR REG-01.
2. Verify PAN, Email & Mobile via separate one-time passwords
The Permanent Account Number shall be validated online by the common portal from the database maintained by the Central Board of Direct Taxes and shall also be verified through separate one-time passwords sent to the mobile number and e-mail address linked to the Permanent Account Number.
3. Aadhaar Authentication for GST Registration
- Change in Sub Rule 4A of Rule 8: Every application made under other than a person notified under sub-section (6D) of section 25, who has opted for authentication of Aadhaar number and is identified on the common portal, based on data analysis and risk parameters, shall be followed by biometric-based Aadhaar authentication and taking photograph of the applicant where the applicant is an individual.
- Rule 4B: The Central Government may, on the recommendations of the Council, by notification specify the States or Union territories wherein the provisions of sub-rule (4A) shall not apply.
Aadhar Authentication was made mandatory for new GST registration from 21 August 2020 onwards. However, the process being followed was not streamlined properly. To handle this issue, now the government has made it completely automatic and no time is lost in physical verification. So, when your Aadhar Authentication is complete (online), only then will the GST verification application be complete.
Note: PAN-linked email and mobile can now be used in conjunction with GST Registration or biometric authentication.
3. ITC reversal in case of non-payment of GST by the supplier and re-availment
Where input tax credit has been availed by a registered person in the return in FORM GSTR-3B for a tax period in respect of such invoice or debit note, the details of which have been furnished by the supplier in the statement of outward supplies in FORM GSTR-1 or using the invoice furnishing facility.
However, the return in FORM GSTR-3B for the tax period corresponding to the said statement of outward supplies has not been furnished by such supplier till the 30th day of September following the end of financial year in which the ITC in respect of such invoice or debit note has been availed, the said amount of ITC shall be reversed by the said registered person, while furnishing a return in GSTR-3B on or before the 30th day of November following the end of such financial year.
Provided that where the said amount of input tax credit is not reversed by the registered person in a return in FORM GSTR-3B on or before the 30th day of November following the end of such financial year during which such input tax credit has been availed, such amount shall be payable by the said person along with interest thereon under section 50.
Provided further that where the said supplier subsequently furnishes the return in FORM GSTR-3B for the said tax period, the said registered person may re-avail the amount of such credit in the return in FORM GSTR-3B for a tax period thereafter.
4. GSTR 3B vs GSTR 1 Mismatch in Liability
Rule 88C has been added to the CGST Rules 2017 vide GST Notification No 26/2022 to implement decisions taken by 48th GST Council Meeting. The Rule 88C specifies manner of dealing with difference in liability reported in statement of outward supplies and that reported in return.
An explanation was added to the said sub-section by Finance Act, 2021 wherein the expression “self-assessed tax” included tax payable in respect of details of outward supplies furnished under section 37 (GSTR-1), but not included in the return furnished under section 39 (GSTR-3B). The said explanation was made effective from 01st January 2023.
Read more here: Rule 88C – GSTR 3B vs GSTR 1 Mismatch in Liability
5. Processing of GST Appeals
To clarify the necessity of submitting a certified copy of the order appealed against and the issue of a final acknowledgement by the appellate body, sub-rule (3) of rules 108 and 109 of the CGST Rules, 2017 were revised. This would simplify compliance for the appellants and speed up the processing of GST appeals.
Learn more about the grounds of GST appeals here.
Rule 109C talks about the withdrawal of GST Appeal. – The appellant may, at any time before issuance of show cause notice under sub-section (11) of section 107 or before issuance of the order under the said sub-section, whichever is earlier, in respect of any appeal filed in FORM GST APL-01 or FORM GST APL-03, file an application for withdrawal of the said appeal by filing an application in FORM GST APL-01/03W.
Learn more about these changes in detail and some other minor update in the GST Notification No. 26/2022- Central Tax.
Best software to reconcile GST data faster and ensure 100% compliance – IRIS GST Software
As a registered taxpayer, reconciling your purchase invoices with the supplier-uploaded invoices on the GST system is a critical activity as it determines your ITC claim. Further, the Government issues legal notices to taxpayers for discrepancies in the ITC claimed in GSTR 3B and the amount as per supplier uploaded details. Our Smart Reconciliation comes in handy for managing reconciliation tasks in a timely, efficient and easy manner.
1. Bulk Data upload facility – It will help you to upload data for multiple GSTINs in one go
2. 2P Summary – Provides a summary of uploaded data. You can quickly check your uploaded data with the count of invoices getting considered for reconciliation
3. Bulk download of GSTR 2A – For multiple periods, you can send ’Get GSTR 2A data’ request in one go
4. Smart reconciliation – It auto-runs on your data and provides you the reconciliation results with summary
5. Monthly reconciliation results with monthly GSTR 2A report – Helps you to decide monthly ITC and how much you can claim as provisional ITC
6. Net vendor summary – It gives you a glance reconciliation status for each vendor
7. PAN level reports and GSTIN level reports – It will help you to analyse in detail of your purchaser-only and supplier-only invoices Send Mail – By using this feature you can easily communicate discrepancies to your vendor
8. Advanced reconciliation – It helps you to extend the scope of comparison between data that is in the supplier-only and purchaser-only category. Some rules that help in better reconciliation are:
- Checking invoices across the financial years
- Fuzzy invoice no. logic
- Checking exact values ignoring invoice number
- Checking invoices within the tolerance provided by you