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Key reasons for GST Notice from GST Dept
With greater GST tax evasion and lower GST revenue, the Indian government has tightened its scrutiny of GST compliance. Notices are frequently sent for a variety of reasons, including tax evasion, non-compliance with rates, late files, missing, incorrect invoices, eWay Bill mismatch, and non-payment.
It's critical to comprehend the many notices that a corporation or professional may receive, as well as their timing, impact, and reaction periods to the Tax Officials.
What are the key causes for receiving a GST Notice?
There are a number of reasons why a GST registered taxpayer may get a GST Notice; some may be due to non-compliance, while others may be due to a regular audit by tax officials; as a result, not all notices are severe.
Below are the top ten grounds for receiving a GST Notice.
- Mismatch between the GSTR 2A report from GST Portal vs Purchase side (inward) invoices
- Most common reason is Non-filing or delayed filing of GST Returns.
- Revocation Request for a Closed GST No.
- Wrong Input Tax Credit Claim in the GST Returns
- Non-payment of Taxes
- Mismatch between GSTR1 Invoices and the details in e-Way Bills
- Input Tax Credit Refund
- Not having GST Registration though the turnover crosses the threshold.
- (Profiteering) : Higher GST rates applied on Sales
- worng documentation or Insufficient documents supplied at the time of GST Registration
Important tips for handling Notice from GST Dept.
We have made a list of the top ten tips how to dealing Notice from the GST Department's
- Identify whether the Notice comes from the Central GST Department or the State GST Dept. If the Notice was sent by CGST, it must include the DIN; otherwise the said GST Notice is invalid.
- Ascertain whether the Notice was issued online or offline. Check the internet number listed on the top left side of the Notice to see if it was issued electronically.
If it was sent to you via email, you should only reply to it via online mode only.
- Make ensure to check Notice's deadlines. You should be able to respond to the GST Notice within the deadlines set in the GST Notice severed to company, and if you are unable to do so, request a written extension from the Officer. The reason for the extension should be relevant & not generic. Examples of generic reasons are the unavailability of the accountant or "not able to arrange the documents in time".
- If you're submitting your response to the Office of GST Officer, then it should be make sure you get an acknowledgement from him or her.
- It is critical to respond to the exact questions posed in the Notice. Businesses frequently respond with something else, despite the fact that the Notice requests something altogether different.
for example, company should required to respond to a mismatch between ITC available in E Way Bill data vs GSTR 3B and.
Instead of providing correct explanation for the discrepancy amount, the business responded by stating that the Eway Bill was not required because the bill value was less than the threshold amount, and that the Eway Bill was also generated in case of delivery challan.
- Always show up for your personal hearing on the scheduled date. If an AR will appear on your behalf, make sure the GST Portal has his or her name updated.
Along with his or her ID proof, he or she should have authorization from you. You should also tell the AR to make assertions only when absolutely necessary, and to respond to inquiries only when he or she is certain of the answers.
- Keep in touch with the GST Department as much as possible. While placing your points, speak to Officer nicely and modestly. Your claims and arguments should be backed up by evidence that is relevant to the issue.
Even if you know you're right and the Officer is conflating different certain facts, don't become annoyed. Request that he/she make notes your points on the note page.
- Always sign the note page when you appear in person or when you are requested to do so.
- Never be afraid to request a Relied Upon Document (RUD), a calculation sheet, and information on the allegation made in the Notice from the officer.
- If you believe you are unable to address the Notice on your own, get advice and instruction from a knowledgeable GST EXPERT and a reputable GST Consultant.
All of these procedures will make your notice experience as easy as possible while also protecting your organisation from a wide range of issues.
What are the implications of neglecting to respond to GST Notices?
If a GST registered taxpayer receives a notice, he or she must act to answer to it; otherwise, the consequences could be severe and include any of the following.
- Recovery of Tax Liabilities directly from a Bank (this is the most scariest part of all)
- Rejection of Refund
- Assets Auction
- Monetary Penalty
- Cancellation of GST Registration
- Rejection of a new GST Registration
- Seizure of Assets
- in the all the above cases, there would be a penalty for delayed filing /non-filing / mis-representation, additionally interest being levied on the GST tax due.
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