Gst Audit

The Goods and Service Tax (GST) in India, which was implemented in 2017, was a groundbreaking move. The new approach has been portrayed as a cost-effective taxation tool. It also streamlines the taxes system in India by creating a single market and adopting the "One Nation, One Tax" concept.

Also Read: GST Registration

The purpose of a GST audit is to check and verify the financial papers that are kept and presented to the tax body. The GST Act of 2017 mandates that registered taxpayers have their accounting books audited. As a result, the GST Audit under section 35 (5) of the Act requires GST registered taxpayers to submit an audited document of their yearly accounts prepared by an Accountant appointed by the Commissioner.

What exactly is a GST audit?

According to Section 35 (5) of the CGST Act, registered taxpayers in India with an aggregate turnover of more than 2 crores in a fiscal year (FY) must have their accounting book audited by an accredited Cost Accountant or Chartered Accountant. The taxpayer registered under GST must submit a copy of the GST audit report, financial statements, and reconciliation statement through Form GSTR 9C. The concerned taxpayer must submit the reports to the tax department once in a financial year. 

Audit Requirement Under GST

The purpose of a GST audit is to verify the returns, records, and other associated documents kept by a GST-registered person. The purpose of a GST audit is for an authorized person of the Tax Authority to ensure that the information is correct and that it complies with the GST Act, 2017.The GST plan was introduced by the Indian government in 2017. It is a taxation system in which a taxpayer can determine their tax burden, file an ITR, and pay the tax. As a result, a GST audit is required to ensure that the taxpayer has appropriately assessed it. An audit is one of the many techniques to verify GST compliance, and it is one of the ways to assess its accuracy.

In India, there are various types of GST audits.

Under the GST, there are three categories of audits. The following are the audits and their specifications:-

1. Turnover-Based GST Audit: The taxpayer appoints or hires a Cost Accountant or Chartered Accountant to conduct this type of audit. According to the CGST Act, this audit is carried out when the taxpayer's turnover surpasses 2 crores and they need audits for their records and accounts.
2. GST Audit (Normal/General): The CGST/SGST Commissioner or any other official authorised by them conducts the GST audit. It is carried out on the Commissioner's order, with the taxpayer given 15 days' notice.
3. GST Special Audit: The Commissioner appoints a Cost Accountant or a Chartered Accountant to perform the audit. It is carried out on the Assistant or Deputy Commissioner's orders, with the Commissioner's previous consent.

Tax authorities conduct a GST audit.

• An SGST/CGST commissioner or authorised staff by the commissioner must complete the tax-payer audit.
• A 15-day notice of GST audit should be issued to the taxpayer before the procedure is carried out.
• The audit will be completed three months after the commencement date set by the tax authorities.
• By giving a good cause in writing format to the authority, the Commissioner of SGST/CGST might extend the audit under the GST period for up to 6 months.

Along with the responsibilities, the Tax Authority has some obligations when performing a GST Audit. Conducting a thorough audit to cross-verify the accuracy of turnover, claimed returns, input tax credits, and taxes paid in accordance with GST laws is one of these tasks. After ending, the auditor should produce a report detailing their findings, the taxpayer's obligations and rights, and the reasons for their conclusions.

In addition to the auditor's responsibilities, the auditee (taxpayer) has some responsibilities as well.

• To provide complete assistance to the auditor in conducting the GST audit on schedule.
• To verify account books and other required papers, the auditee should submit all information to the auditor.

Taxpayers' Documentation Requirements

In order to be audited for GST, the taxpayer must provide a few papers to the auditee. The following are the documents:-

• Financial Audited Statements based on PAN.
• GSTIN-based Annual Return (Form GSTR-9)

GST Report Submission Deadline

The deadline for GST Audit limit and submission is December 31st of the previous fiscal year. The due date for registered taxpayers can be extended via the CBIC notice.

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