Every Registered person is required to keep and maintain all record at his principal place of business.
Who maintain accounts under GST ?,
It is the responsibility of the following persons to maintain specified records-
- The owner / Operator of warehouse or godown or any other place used for storage of goods.
- Every transporter.
- Every registered person whose turnover during a financial year exceeds the prescribed limit (2 crore) will get his accounts audited by a chartered accountant or a cost accountant.
What records must be maintained under GST ?
Every registered person must maintain records of -
- Production or manufacture of goods.
- Inward and outward supply of goods or services or both (Purchase and Sales Register).
- Stock of goods (Inventory Register),
- Input tax credit availed (Electronic Credit Ledger),
- Output tax payable and paid (Electronic Liability and Electronic Cash Ledger) and
- Other particulars as may be prescribed Records Information Required to kept on that place.
Account should contain detail of goods manufactured in a factory or production house. Every Assesses carrying out manufacturing activity.
Purchase Register:- All the purchases made within a tax period for manufacturing of goods or provision of services all by all Assesses.
Sales Register :- Account of all the sales made within a tax period must be maintained by all assesses.
Stock Register :- This register should contain a correct stock of inventory available at any given point of time.
Input Tax Credit Availed :- This register should maintain the details of Input Tax Credit Availed for a given tax period of GST liability outstanding to be adjusted against input credit or paid out directly .
Output Tax Paid Register :- This register should maintain the details of GST paid for a particular tax period.
Other Records :- Specified Government can further specify by way of a notification, additional records and accounts to be maintained Specific Businesses as notified by the government.
Electronic Cash and Credit Ledger :- Every registered taxpayer will have 3 ledgers under GST which will be generated automatically at the time of registration and will be maintained electronically.
Electronic Cash Ledger :- This ledger will serve as an electronic wallet. The taxpayer will have to deposit money into his cash ledger (add money to the wallet). The money will be utilized to make the payment.
Electronic Credit Ledger :- The input tax credit on purchases will be reflected here under three categories i.e. IGST, CGST & SGST.
The taxpayer will be able to utilize the balance shown in this account only for payment of tax (not for interest, penalty etc.).
E-Liability Ledger :- This
ledger will show the total tax liability of a taxpayer after netting off for
the month. This ledger will be auto-populated.
Period for Retention of Accounts under GST :-
As per the GST Act, every registered taxable person must maintain the accounts books and records for at least 72 months (6 years). The period will be counted from the last date of filing of Annual Return for that year. The last date of filing the Annual return is 31st December of the following year. For example: For the year 2017-2018, the due date of filing the annual return is 31.12.2018. The books & records of 2017-2018 must be maintained for 6 years, i.e., 31.12.2023 If the taxpayer is a part of any proceedings before any authority (First Appellate) or is under investigation, then he must maintain the books for 1 year after the order of such proceedings/appeal has been passed.
Consequences of Not Maintaining Proper Records:- If the taxpayer fails to maintain proper records in respect of goods/services, then the proper officer shall treat such unaccounted goods/services as if the taxpayer had supplied them. The officer will determine the tax liability on such unaccounted goods. The taxable person will be required to pay the tax liability calculated along with penalty.
Disclaimer:- The contents of this document are solely
for informational purpose. It does not constitute professional advice. Neither
the authors accepts any liabilities for any loss or damage of any kind arising
out of any information in this document nor for any actions taken in reliance
thereon.
GST data and Cost Records Annexures to be maintained :-
Annexures
to be maintained as per the headings of Customs Tariff Headings: Four Digit
Level or Eight Digit Level MCA has issued one notification issued on 20th Dec
2017 which is going to pave the way for alignment of Cost Records with GST
records after the implementation of GST.
The Companies Cost Records & Audit
Rules 2014 (CCRAR) earlier referred to CETA whereas in the GST regime,
presently most of the chapters of Central Excise Act do not exist except for
few Chapters. Now with the issue of the notification on 20th Dec 2017, the CETA
Headings have been replaced with Customs Tariff headings (Refer Extract 1) It
also needs mention that 'heading', in respect of goods, means a description in
list of tariff provisions accompanied by a four-digit number and includes all
sub-headings of tariff items the first four-digits of which correspond to that
number and tariff item means a description of goods in the list of tariff
provisions accompanying eight-digit number.
A question is being raised by
different quarters that whether the cost data is required to be maintained at
four-digit level (heading) or at eight-digit level (tariff item).
It needs
mention that for the year 2016-17, the costing data was required to be
maintained at eight-digit level of CETA. Also, the revised business rules for
XBRL had mandated eight-digit codes. The concerned rule reads like 'The
concatenated "CETA Code of Manufactured Product" and 'Subheading of
CETA Code' shall be a valid 8-digit CETA code'. Under the GST regime also the
maintenance of cost records may be kept at eight-digit level and reporting at
four-digit level. For the 2017-18, the data to be reported to MCA will be from
two different indirect tax regimes, April 2017 to June 2017 from Excise/VAT and
from July 2017 to Mar 2018 from GST regime. The back up of the data need to be
kept separately and then consolidated for the purpose of reporting to Ministry
of Corporate Affairs under CCRAR 2014, wherever applicable.
One need not forget
that any organization dealing in export or import is required to keep the data
at eight-digit level as per the Customs Tariff Act. Under GST for the sake of
convenience initially, the government may have allowed the data to be
maintained at four-digit level, but in future GST authorities may ask for the
data at the eight-digit level as the reference to the Customs Tariff has been
made in the GST notifications.
Suggestion: The companies which have to follow
Companies Cost Records and Audit Rules 2014 are required to maintain the data
at the product level and then at tariff heading level for reporting to MCA,
these companies should keep maintaining the data at Eight Digit Level also. GST
regime also referred to Customs Tariff Act as given below (Extract 2) for the
purpose of imposition of rates on various types of commodities. Though,
the GST rates notification have shown four digits and GST rates have been
mentioned at the four-digit levels i.e. headings but it needs mention that a
reference to the 'Tariff item', 'sub-heading' 'heading' and 'Chapter' has also
been made in the same notification and Extract 1: Extract of Notification no.
G.S.R. 1526(E). dated 20th Dec 2017 issued by Ministry of Corporate Affairs is
given below:
In the Companies (cost records and audit) Rules, 2014 (hereinafter
referred to as the principal rules), in rule 2, for clause (aa) the following
clause shall be substituted and shall be deemed to have been substituted with
effect from the 1st day of July, 2017, namely:- (aa) 'Customs Tariff Act
Heading' means the heading as referred to in the Additional Notes in the First
Schedule to the Customs Tariff Act, 1975 (51 of 1975). 3. In the principal
rules, in rule 3, for the words 'Central Excise Tariff Act Heading', occurring
at both the places, the words 'Customs Tariff Act Heading' shall be substituted
and shall be deemed to have been substituted with effect from the 1st day of
July, 2017.
In the principal rules, in the Annexure, in Form CRA-2, Form
CRA-3 and Form CRA-4, for the words 'CETA Heading', wherever it occurs, the
words 'CTA Heading' shall be substituted and shall be deemed to have been
substituted with effect from the 1st day of July, 2017. Extract 2: Extracts
from Notification No.1/2017-Integrated Tax (Rate) New Delhi, the 28th June,
2017 & Notification No.1/2017-Central Tax (Rate) New Delhi, the 28th June,
2017 (iii) 'Tariff item', 'sub-heading' 'heading' and 'Chapter' shall mean
respectively a tariff item, sub-heading, heading and chapter as specified in
the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules
for the interpretation of the First Schedule to the Customs Tariff Act, 1975
(51 of 1975), including the Section and Chapter Notes and the General
Explanatory Notes of the First Schedule shall, so far as may be, apply to the
interpretation of this notification. 2. This notification shall come into force
with effect from the 1st day of July, 2017. Explanatory/Additional Notes of the
First Schedule of The Customs Tariff Act The Additional Notes in the First
Schedule of The Customs Tariff Act 1975, explains the different terms as
follows: (a) 'heading', in respect of goods, means a description in list of
tariff provisions accompanied by a four-digit number and includes all
sub-headings of tariff items the first four-digits of which correspond to that
number; (b) 'sub-heading', in respect of goods, means a description in the list
of tariff provisions accompanied by a six-digit number and includes all tariff
items the first six-digits of which correspond to that number; (c) 'tariff
item' means a description of goods in the list of tariff provisions
accompanying eight-digit number and the rate of customs duty;
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