GSTR 2 forms are required by all businesses that purchase inward supplies and are an important part of availing Input Tax Credit. It is a form that is required for income tax purposes, and every business in India is required to file it. It provides proof of the number of goods purchased from suppliers, including reverse charges, and notes down these transactions on paper. GSTR 2 contains details related to invoicing and summarises inward purchases of sales/goods done by businesses as a monthly return.
How to File GSTR 2 Online?
GSTR 2 due date for filing is the 15th of every month, and there is a 5-day gap between the filing of GSTR 1 and GSTR 2 for taxpayers. Since September 2017, GSTR 2 has been suspended due to amendments made in CGST rules and instead replaced with GSTR 3B, which combines the forms GSTR-2 and GSTR-3, respectively. In this article, we’re going to give an overview of the filing process and cover all the essentials needed for GSTR 2 filing.
You can file your GSTR 2 forms online by simply logging into the GST Portal and uploading the necessary details. Be sure to follow the official format when filling in your GSTR 2 form online. There are also third-party tools in the market that help individuals file their GSTR 2 forms online.
Below is the correct formatting of a GSTR 2 form:
Importance of GSTR 2 Form for Taxpayers
The purpose of the GSTR-2 form is to make sure the details provided by sellers for returns on sales match the details of returns filed by buyers on their purchases. GSTR 2 forms are used to provide more transparency on financial transactions and are tax return forms meant to be filed on a monthly basis.
Every business registered under the Goods and Services Tax Act is required to file a GSTR 2 form.
Difference Between GSTR 2A and GSTR 2
There is not much difference between GSTR 2A and GSTR 2 when filing monthly returns for invoices related to inward supplies for businesses.
GSTR 2A is more editable and already contains details of outward supplies used for filing GSTR 2. GSTR 2A is continuously updated by suppliers and has records that may be modified, added, or deleted from GSTR 2 forms.
Your input tax credit eligibility is decided based on your GSTR 2 application. It is important to ensure that all the details filled up and forwarded from GSTR 2A forms are correct.
How to Upload Purchase Invoice in GST Portal?
Users can visit the GST Portal to upload their purchase invoices online manually. Simply follow these steps in order to do it:
- Log in to the GST portal using your user credentials.
- Select the Financial Year and Return Filing Period you want to file your monthly invoices for
- Click on "Prepare Online" below GSTR-2
- 11 tiles will get loaded up, and you’ll see them visible on the screen. Some of these will be auto-populated. You also need to fill in the details for the tiles with no information filled in for your GSTR 2 filing.
- Choose B2B invoices and start providing your details one by one. If you have multiple invoices, you will have to upload and fill them individually on the GST portal system. The details of all your issued invoices must be visible on the GST portal by the time you’ve entered them.
- Get ready to input information about your B2C large invoices once you’re done. You will require only a few details for this step, and the process is a lot simpler than entering B2B invoicing details.
- After you are finished uploading your B2B information and B2C invoices, you need to provide other minor details such as advances received from sales, credit/debit notes, B2C small invoices, etc. With this, you have completed your GSTR-2 filing online.
How to File GSTR 2 Offline?
If you want to file your GSTR 2 forms offline, you can manually download the GST offline return tool. The software is an .Exe file that has to be installed on Windows 7 or above, and you also need to have Microsoft Excel 2007 present on your computer.
After you finish the installation and run the program, you will get all the information required for uploading your invoices using the tool. Prepare the details in the format mentioned and download your invoices in JSON format from the software. You can upload this GSTR 2 return and B2B invoicing data directly on the GST portal after completing your GST information filing using the program.
Details Needed to File Your GSTR-2 Forms
For individuals or business owners planning to do their GSTR-2 filing, here is a checklist of information they must get ready before filling up the forms.
- Taxpayer’s name
- GSTIN (a unique 15-digit number assigned to all GST-registered entities)
- TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) details
- Registered Input Tax Credit
- Details of inwards supplies of goods, reverse charges made, and overseas capital goods imported.
- Information about reversals or reclaims done on input tax credits
- HSN Summary and HSN codes
- Details about additions or deductions made to the sum amount to fix any mismatches done during the taxation
- Consolidated financial statements showing all advance payments made to suppliers
- Documents related to amendments made to the details of inward supplies being purchased
Who Should Not File GSTR 2?
Every business in India that deals with purchasing inventory or supplies is required to file a GSTR 2 form. The only individuals who are exempt from filing GSTR 2 are:
- Composition dealers
- Non-residential entities
- Input Service Distributors
- Individuals who have already collected TCS
- Individuals who have already deducted TDS
- Online Information and Database Access or Retrieval Services Suppliers (OIDAR)
Keep in mind that you have to maintain a record of all your invoices and financial statements when filing your GSTR-2 form. You will have to supply your GSTIN number and provide transaction details about non-GST supplies as well. An OTP will be sent on your registered mobile number for identity verification during GST filing. There is an Aadhaar-based verification option that you can also avail of if you prefer not to use OTP.
Common Errors Made When Filing GSTR 2
There are times when errors are made while filling up GSTR 2 forms, despite fact-checking the details.
- The most common mistake made while filling up these forms is entering incorrect or mismatching amounts regarding the purchase and sales of goods.
- Cases where additional invoices are added to these forms are common, and the supplier has to cross-check the validity.
- The supplier can mention the wrong GSTIN number of the purchaser while filling up these forms.
- Sometimes the purchaser might not find invoices available in accounts such as for goods being in transit and will have to keep those invoices on hold for the taxation month.
- Mismatching HSN/SAC codes for GST with respect to both parties is another common error made during GSTR 2 filing.
Therefore, to avoid these errors, follow the GSTR format and guidelines provided in Khatabook to complete them properly.
Filing your GSTR 2 is an important part of maintaining records of business transactions, and every purchaser must file their GSTR 2 every month. If you are new to GSTR 2 filing or need assistance, you can use a trusted platform like Khatabook for reference.
Use Khatabook for more information about bills and GST invoices today!