The Goods and Services Tax (GST) Council approved the implementation of FORM GSTR-1A, a new mechanism that empowers registered taxpayers to update details of sales transactions reported in previously filed GSTR-1 returns. This was confirmed by the Finance Minister Nirmala Sitharaman in the press meet after the Council Meeting.
The 53rd meeting of the GST Council, held in New Delhi today, introduced the significant reform aimed at improving the accuracy and efficiency of Goods and Services Tax (GST) filing.
Prior to GSTR-1A, any errors or omissions identified after filing GSTR-1 could only be rectified in the subsequent return period’s filing.
This often resulted in discrepancies and complexities. GSTR-1A addresses this by offering taxpayers the flexibility to revise or add records within the same month after filing GSTR-1, but before filing the GSTR-3B summary return. This enables them to rectify mistakes and ensure their tax liabilities are accurately reflected.
The introduction of GSTR-1A simplifies the process of incorporating changes identified by buyers. Previously, data from a seller’s GSTR-1 would populate the buyer’s GSTR-2 form. The buyer could then alter any discrepancies, which would be reflected in the seller’s GSTR-1A.
Example: If X purchases pens worth Rs. 500 from Y General Stationery Store, but Y mistakenly reports the sale as Rs. 50 in his GSTR-1, the revised information from X’s GSTR-2A would now be reflected in Y’s GSTR-1A. This enables Rahul to promptly update his GSTR-1, ensuring both parties report the transaction accurately.
As per Rule 59(1)(4), which prescribes the Form and manner of furnishing details of outward supplies —
(1) Every registered person, other than a person referred to in section 14 of the Integrated Goods and Services Tax Act, 2017, required to furnish the details of outward supplies of goods or services or both under section 37, shall furnish such details in FORM GSTR-1 electronically through the common portal, either directly or through a Facilitation Centre notified by the Commissioner.
(2) The details of outward supplies of goods or services or both furnished in FORM GSTR-1 shall include the–
> (a) invoice wise details of all –
>> (i) inter-State and intra-State supplies made to the registered persons; and
>> (ii) inter-State supplies with invoice value more than two and a half lakh rupees made to the unregistered persons;
> (b) consolidated details of all –
>> (i) intra-State supplies made to unregistered persons for each rate of tax ; and (ii) State wise inter-State supplies with invoice value upto two and a half lakh rupees made to unregistered persons for each rate of tax;
> (c) debit and credit notes, if any, issued during the month for invoices issued previously.
(3) The details of outward supplies furnished by the supplier shall be made available electronically to the concerned registered persons (recipients) in Part A of FORM GSTR- 2A, in FORM GSTR-4A and in FORM GSTR-6A through the common portal after the due date of filing of FORM GSTR-1.
(4) The details of inward supplies added, corrected or deleted by the recipient in his FORM GSTR-2 under section 38 or FORM GSTR-4 or FORM GSTR-6 under section 39 shall be made available to the supplier electronically in FORM GSTR-1A through the common portal and such supplier may either accept or reject the modifications made by the recipient and FORM GSTR-1 furnished earlier by the supplier shall stand amended to the extent of modifications accepted by him.
The effects range from easier availment of Input Tax Credit by buyers, without receiving notices to lesser penalties for mistakes in GSTR-1 filed by the sellers.
In short, the GST Council has approved a new optional form, GSTR-1A. This form allows businesses to make changes or add missing information to their GSTR-1 filings for a specific tax period. These changes can be made before filing the GSTR-3B summary return for the same period.
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