written by Khatabook | August 3, 2021

GSTR 2 Application Process for Taxpayers - Filing, Format, Eligibility, and Rules

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:

  1. Log in to the GST portal using your user credentials.

  1. Select the Financial Year and Return Filing Period you want to file your monthly invoices for

  1. Click on "Prepare Online" below GSTR-2

  1. 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.

  1. 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.
  2. 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.

  1. 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.

  1. Taxpayer’s name
  2. GSTIN (a unique 15-digit number assigned to all GST-registered entities)
  3. TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) details
  4. Registered Input Tax Credit
  5. Details of inwards supplies of goods, reverse charges made, and overseas capital goods imported.
  6. Information about reversals or reclaims done on input tax credits
  7. HSN Summary and HSN codes
  8. Details about additions or deductions made to the sum amount to fix any mismatches done during the taxation
  9. Consolidated financial statements showing all advance payments made to suppliers
  10. 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. 

Conclusion

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!

FAQs

1. What is GSTR 2?

GSTR 2 is a monthly return filed by registered taxpayers using the auto-populated details in GSTR forms 1, 5, 6, 7, and 8, filled and submitted by corresponding suppliers. Missing details and invoices are added along with these details, and by submitting the GSTR 2, the taxpayer can avail their eligible Input Tax Credit (ITC) for all their inward supplies.

2. Can GSTR 2 filing dates be extended?

Yes, GSTR 2 timeline can be extended, and the Board/Commissioner issues a notification to taxpayers about such updates.

3. Is there any penalty fee levied upon taxpayers who file GSTR 2 after the due date?

Yes, taxpayers are charged a late fee for filing GSTR 2 online after the due date. The GST Portal calculates the amount and the fee has to be paid before the completion of the filing of GSTR 3, which is required for ensuring that returns are deemed valid. 

4. What does the term ‘inward supplies’ mean under GST?

Inward supplies refer to the purchase of goods/services from a supplier, upon which tax is payable, even in the cases of reverse charges.

5. What are the prerequisites for taxpayers before filing GSTR 2?

The prerequisites for taxpayers before filing GSTR 2 are:

  • Taxpayers must possess a valid GSTIN number and have a registered account on the GST Portal (User ID and password)
  • They should have the option to file GSTR-2 forms for GSTIN cancellations during the active period for taxation
  • A Digital Signature Certificate (DSC) that is valid and not yet expired is mandatory
  • Taxpayers must have a valid Aadhar ID and registered mobile number linked to it. The mobile number should be added to their GST registration details at the time of enrollment through EVC
  • GSTR-1 filing due date should have lapsed for the same period of taxation

6. Are there any individuals or taxpayers who are exempt from filing GSTR 2?

Yes, here is a list of individuals and registered taxpayers who do not have to file GSTR 2:

  • Taxpayers who have registered under GST Composition Scheme
  • Input Service Distributors
  • Non-residential taxpayers
  • Individuals who are already paying their taxes under Section 51 (TDS) and Section 52 (TCS)

7. Can taxpayers file information about their inward supplies before the GST tax filing periods, and if so, under what circumstances?

Yes, you can file details about your inward supplies before the end of the tax period or filing due dates. The only scenarios where this is allowed are:

  • If you are a casual taxable person
  • If you have applied for cancellations or Surrender of Registration (Surrender of Registration applications are approved only after cancellations get validated)

8. What happens after I file my GSTR 2 form?

When you submit your GSTR 2, you will:

  • Get an ARN generated. If you have submitted using the offline utility tool, a temporary ID will be issued after uploading your JSON files. When the form gets submitted online, your ARN number will be given to you.
  • An email and SMS notification will be sent to your registered address and number to confirm that you’ve successfully filed your GSTR 2

Affixation of DSC gets done and post-form submission and EVC, the GSTR 2 is forwarded to:

  • CBEC (Central Board of Excise and Customs)
  • And, Tax authorities of jurisdictional states/UT

If you modify, delete, or add details to your GSTR 2, the details will get auto-populated in forms GSTR 1-A, 1, and 5 and get reflected on the supplier’s end. The updating of electronic credit ledgers is also done for all modifications.

9. Is it possible to file a Nil return if I have received no inward supplies in a given month?

You can edit the auto-populated details on your GSTR-2 form and submit it accordingly if you have no inward supplies details to show for a given month.

10. Is there a way to preview my GSTR 2 before submitting it online?

A preview button is displayed on the Summary page of your GSTR-2 application. It is recommended you click on it to receive a copy of your GSTR-2 draft. After the file is downloaded, please open it and go through the details section by section. Ensure all the information is accurate and when you’re confident, go ahead and finish your GSTR-2 submission.

11. How do I sign my GSTR 2?

There are various ways to sign your GSTR-2 at the time of filing: They are:

  1. Digital Signature Certificates (DSC) - DSC is a valid digital certificate that contains electronic information that proves one’s identity. The GST portal approves only Class I and Class II DSC, which are PAN-based. You can click here to contact the concerned authorities to get a DSC issued if you don’t have one already.
  1. Electronic Signature - You can sign your GSTR-2 form electronically to complete it. An OTP will be sent to your registered mobile number linked to your Aadhar card for verification by the GST Portal to finish the process.
  1. Electronic Verification Code (EVC) - This is the OTP generated by the GST Portal, which is sent to your mobile number when filing your GSTR-2 form.

12. Can a taxpayer add pre-GST invoices and debit/credit notes before the date of registration?

Uploading pre-GST invoices are not allowed by the GST portal before registration dates, but debit/credit notes are allowed for pre-GST entries.

mail-box-lead-generation

Got a question ?

Let us know and we'll get you the answers

Please leave your name and phone number and we'll be happy to email you with information

Related Posts

What Are The Goods Exempted Under GST?

What Are The Goods Exempted Under GST?


Know About GST On Labour Charges In India

Know About GST On Labour Charges In India


GST: Quarterly Return Filing and Monthly Payment of Taxes (QRMP)

GST: Quarterly Return Filing and Monthly Payment of Taxes (QRMP)


Place of Supply of Goods under GST

Place of Supply of Goods under GST


How To File Nil GSTR 1 Return on GST Portal

How To File Nil GSTR 1 Return on GST Portal


Know About ITC reversal under GST

Know About ITC reversal under GST


How did GST Impact The Hospitality Industry?

How did GST Impact The Hospitality Industry?


Different Types of E-Ledgers under GST

Different Types of E-Ledgers under GST


Where Can Input Tax Credit under GST Not Be Availed?

Where Can Input Tax Credit under GST Not Be Availed?