GSTR-9: Complete Guide to Filing Annual GST Return

The introduction of the Goods and Services Tax (GST) in India on July 1, 2017, marked a significant transformation in the country's indirect taxation system. The new regime consolidated various taxes into a single, unified tax structure, aiming to streamline the process and enhance compliance. Among the various compliance requirements under GST, filing the annual return, known as GSTR-9, stands out due to its comprehensive nature and significance.

GSTR-9 is an annual return that every registered taxpayer under GST must file, summarizing the details of outward and inward supplies made during the financial year, along with the taxes paid, input tax credits (ITC) claimed, and other relevant details. This detailed guide delves into the intricacies of GSTR-9, providing a thorough understanding of its components, filing process, common challenges, and best practices for compliance.

Purpose of Filing Annual Return

GSTR-9 is an annual return mandated under the GST regime, aimed at consolidating and summarizing the data reported in the monthly or quarterly returns (GSTR-1, GSTR-3B, and GSTR-4) throughout the financial year. It provides a comprehensive overview of the taxpayer's business activities, ensuring transparency and accountability in tax compliance.

Components of GSTR-9

GSTR-9 is divided into six parts, each capturing specific details related to the taxpayer's transactions and compliance activities during the financial year:

Basic Details (Part I):

This section includes basic information about the taxpayer, such as GSTIN, legal name, trade name (if any), and the financial year for which the return is being filed.

Details of Outward and Inward Supplies (Part II):

This part summarizes the taxable outward supplies made during the financial year, including the value of supplies, tax payable, and tax paid.

It also captures the details of inward supplies received from registered and unregistered persons, along with the tax paid under the reverse charge mechanism (RCM).

Any amendments made to the outward and inward supplies, including credit notes and debit notes, are also reported in this section.

Details of ITC (Part III):

This section provides details of the input tax credit (ITC) availed during the financial year, including ITC on inward supplies, ITC on imports, and ITC claimed on inward supplies liable to reverse charge.

It also includes details of ITC reversed and ineligible ITC, ensuring accurate reporting of ITC claims.

Details of Tax Paid (Part IV):

This part summarizes the total tax payable and paid during the financial year, segregated into central tax, state/UT tax, integrated tax, and cess.

It also includes details of interest, late fees, and penalties paid, if any.

Particulars of Transactions of Previous FY Declared in Returns of April to September of Current FY or up to the Date of Filing of Annual Return of Previous FY Whichever is Earlier (Part V):

This section captures the amendments made in the returns filed between April to September of the current financial year or up to the date of filing the annual return of the previous financial year.

It ensures that any corrections or updates to the previous year's data are accurately reflected in the annual return.

Other Information (Part VI):

This section includes details of demands and refunds, HSN-wise summary of outward and inward supplies, late fees payable and paid, and segregation of inward supplies received from different categories of taxpayers.

It also provides an overview of any additional liability identified during the reconciliation process.

Eligibility and Due Date

Every registered taxpayer under GST is required to file GSTR-9, with certain exceptions, including:

Casual taxable persons

Input service distributors (ISD)

Non-resident taxable persons

Persons paying TDS under Section 51 of the CGST Act

The due date for filing GSTR-9 is December 31st of the subsequent financial year. For instance, the return for the financial year 2021-22 is due by December 31, 2022. Timely filing of GSTR-9 is crucial to avoid penalties and ensure compliance with the GST regulations.

Late Fees and Penalties

Failure to file GSTR-9 within the due date attracts a late fee of Rs. 200 per day of delay (Rs. 100 under CGST and Rs. 100 under SGST), subject to a maximum of 0.25% of the taxpayer’s turnover in the relevant state or union territory. Notably, there is no late fee on IGST. It is imperative for taxpayers to adhere to the due dates and ensure timely filing to avoid such penalties.

Filing Process of GSTR-9

The process of filing GSTR-9 involves several steps to ensure accuracy and completeness. The GST portal provides both online and offline options for preparing and filing the return. Here is a step-by-step guide to the filing process:

Step 1: Log in to the GST Portal

Visit the GST portal (www.gst.gov.in).

Use your valid credentials (username and password) to log in.

Step 2: Navigate to the Annual Return Tab

Click on the ‘Services’ tab.

Under ‘Returns’, select ‘Annual Return’.

Step 3: Select the Financial Year

Choose the financial year for which you are filing the return.

Step 4: Prepare GSTR-9

Click on ‘Prepare Online’ or ‘Prepare Offline’ based on your preference.

Enter the required details in each section carefully.

Cross-verify the auto-populated information with your records.

Step 5: Preview the Draft

After entering all the details, preview the draft return.

Make necessary corrections if there are discrepancies.

Step 6: Compute Liabilities

Use the ‘Compute Liabilities’ option to calculate the tax liabilities based on the details provided.

Step 7: Pay Additional Liability

If there is any additional liability, pay the same through the electronic cash ledger.

Ensure there are sufficient funds in the cash ledger to cover the liability.

Step 8: File GSTR-9

After verifying all details and ensuring the payment of additional liabilities, click on ‘File GSTR-9’.

Use DSC (Digital Signature Certificate) or EVC (Electronic Verification Code) to authenticate and file the return.

Step 9: Download Filed Return

Once filed, download and keep a copy of the filed return for your records.

Detailed Breakdown of Each Section in GSTR-9

Part I: Basic Details

This section captures the essential information about the taxpayer. The key fields include:

Financial Year: The year for which the return is being filed.

GSTIN: The GST Identification Number of the taxpayer.

Legal Name: The legal name of the registered taxpayer.

Trade Name: The trade name of the taxpayer (if applicable).

Part II: Details of Outward and Inward Supplies Declared During the Financial Year

This part is further divided into various sections:

Details of Advances, Inward and Outward Supplies on which tax is payable:

Supplies made to unregistered persons (B2C): Aggregate value of supplies made to unregistered persons on which tax is payable.

Supplies made to registered persons (B2B): Aggregate value of supplies made to registered persons on which tax is payable.

Export: Total value of export on which tax is payable.

Supplies to SEZs: Supplies made to SEZs on which tax is payable.

Deemed Exports: Aggregate value of deemed exports.

Details of Outward Supplies on which tax is not payable:

Zero-rated supplies (excluding exports): Value of zero-rated supplies other than exports.

Supplies on which tax is to be paid by recipient on reverse charge basis: Supplies on which the recipient is liable to pay tax on reverse charge basis.

Exempted, Nil-rated and Non-GST supplies: Aggregate value of exempted, nil-rated and non-GST supplies.

Details of Inward Supplies:

Inward supplies on which tax is payable on reverse charge basis: Value of inward supplies on which tax is payable under RCM.

Inward supplies from registered persons: Total value of inward supplies received from registered persons.

Part III: Details of ITC Declared in Returns Filed During the Financial Year

This section is crucial as it captures the details of ITC claimed, reversed, and ineligible ITC:

ITC Availed During the Financial Year:

ITC on inward supplies (excluding imports and RCM): ITC claimed on inward supplies other than imports and supplies liable to RCM.

ITC on inward supplies liable to RCM: ITC claimed on inward supplies on which tax is payable under RCM.

ITC on imports: ITC claimed on imports.

ITC from ISD: ITC received from Input Service Distributor.

ITC Reversed and Ineligible ITC:

As per Rule 37, 39, 42, and 43 of CGST Rules: ITC reversed as per the relevant rules.

Other reversals: Any other ITC reversals.

Ineligible ITC: ITC which is ineligible for claim.

Part IV: Details of Tax Paid as Declared in Returns Filed During the Financial Year

This part provides a summary of the total tax payable and paid during the financial year:

Tax Payable:

Central Tax: Tax payable under CGST.

State/UT Tax: Tax payable under SGST/UTGST.

Integrated Tax: Tax payable under IGST.

Cess: Cess payable.

Tax Paid:

The corresponding details of tax paid under each head.

Interest, Late Fee, and Penalty Paid:

Details of interest, late fee, and penalty paid during the financial year.

Part V: Particulars of the Transactions for the Previous FY Declared in Returns of April to September of Current FY or up to Date of Filing of Annual Return of Previous FY Whichever is Earlier

This section captures any amendments or transactions pertaining to the previous financial year but declared in the current financial year's returns up to the date of filing of the annual return:

Amendments to Outward Supplies: Details of amendments to outward supplies.

Amendments to Inward Supplies: Details of amendments to inward supplies.

Other ITC related Information: Any other relevant ITC-related information.

Part VI: Other Information

This part includes additional details that provide a comprehensive view of the taxpayer's activities:

Demands and Refunds:

Details of Demands: Any demands raised during the financial year.

Details of Refunds: Any refunds claimed during the financial year.

HSN-wise Summary of Outward and Inward Supplies:

Outward Supplies: HSN-wise summary of outward supplies.

Inward Supplies: HSN-wise summary of inward supplies.

Late Fees Payable and Paid:

Details of late fees payable and paid for the delay in filing returns.

Segregation of Inward Supplies Received from Different Categories of Taxpayers:

From Composition Taxpayers: Inward supplies from composition taxpayers.

From Other than Composition Taxpayers: Inward supplies from other taxpayers.

From Unregistered Persons: Inward supplies from unregistered persons.

Total ITC Claimed: Total ITC claimed on inward supplies.

Important Points to Consider

Reconciliation

Reconciliation is a crucial step in the GSTR-9 filing process. It involves matching the data reported in the monthly/quarterly returns (GSTR-1, GSTR-3B) with the books of accounts to ensure accuracy and consistency. Key reconciliation activities include:

Matching Invoices: Cross-checking the invoices reported in GSTR-1 with the sales register.

Verifying ITC Claims: Ensuring that the ITC claimed in GSTR-3B matches the purchase register and GSTR-2A.

Amendments and Corrections: Incorporating any amendments or corrections made during the financial year.

Review of ITC Claims

Thoroughly reviewing the input tax credit (ITC) claims is essential to avoid reversals and penalties. Key aspects to consider include:

Eligibility of ITC: Ensuring that the ITC claimed is eligible as per the GST provisions.

Reversal of Ineligible ITC: Identifying and reversing any ineligible ITC claimed during the financial year.

Documentation: Maintaining proper documentation to substantiate the ITC claims.

Documentation

Proper documentation is vital for accurate filing and future reference. Key documents to maintain include:

Sales and Purchase Registers: Detailed records of all sales and purchases made during the financial year.

Invoice Copies: Copies of all invoices issued and received.

ITC Records: Detailed records of ITC claimed, reversed, and ineligible ITC.

Reconciliation Statements: Statements reconciling the data reported in GSTR-1, GSTR-3B, and the books of accounts.

Amendments and Changes

The GST Council periodically reviews and recommends changes to the GST law and compliance requirements. Over the years, several changes have been made to the format and requirements of GSTR-9 to simplify the filing process and reduce the compliance burden on taxpayers. Notable changes include:

Simplification of Tables: Certain tables in GSTR-9 have been made optional to ease the reporting burden.

Auto-Population: Enhanced auto-population of data to reduce manual entry and errors.

Extended Due Dates: The due dates for filing GSTR-9 have been extended multiple times to provide relief to taxpayers.

Waiver of Late Fees: In certain instances, late fees have been waived to mitigate the impact of compliance delays.

Common Challenges and Solutions

Data Reconciliation

Challenge: One of the major challenges faced by taxpayers is the reconciliation of data between GSTR-1, GSTR-3B, and the books of accounts.

Solution: Regular reconciliation and rectification of discrepancies on a monthly basis can mitigate this issue. Using accounting software with GST compliance features can also simplify the process.

Errors in Auto-Populated Data

Challenge: Auto-populated data in GSTR-9 may sometimes have errors or inconsistencies.

Solution: Cross-verifying the auto-populated data with your records before filing is crucial. Any discrepancies should be corrected manually in the return.

Complex ITC Claims

Challenge: Claiming input tax credit accurately, especially for large businesses with numerous transactions, can be complex.

Solution: Maintain detailed records of all inward supplies and ITC claims. Regularly review and reconcile ITC with GSTR-2A and GSTR-3B.

Technical Glitches

Challenge: Technical issues on the GST portal can cause delays and frustration during the filing process.

Solution: Avoid last-minute filing to reduce the risk of encountering technical glitches. If issues persist, contacting GST helpdesk or support can provide timely assistance.

Conclusion - Filing GSTR-9 is a critical compliance requirement under the GST regime, ensuring that taxpayers provide a consolidated summary of their annual business activities. Understanding the structure, components, and filing process of GSTR-9 is essential for accurate and timely compliance. Regular reconciliation, thorough review of ITC claims, and meticulous record-keeping can significantly simplify the filing process and minimize errors. As the GST landscape continues to evolve, staying updated with the latest amendments and guidelines will ensure seamless compliance and avoid penalties.