Understanding Mismatch Concept under GST

In the context of GST, mismatch refers to the level of discrepancy between the information provided in GSTR – 3B and the information provided in GSTR – 2B and GSTR – 2A. GSTR – 3B is a consolidated form of monthly returns that comprises information on a registered person's total inward supply, outbound supply, input tax availed, tax paid, and tax collected over the course of a year. GSTR – 2A is an auto-populated form that contains information on all inward supplies made by the registered person in a particular month. It is auto-populated when the seller files his GSTR – 1. GSTR – 2B is a system-produced static form that is generated on the 12th of the next month and comprises all of the input tax credits claimed by the seller on each recipient of supply made by the seller during each tax period. The amount in GSTR – 2A and GSTR – 2B should be the same as the amount in GSTR – 3B.

Section 42 of CGST Act provides for matching, reversal, and reclaim of ITC and provides mechanism for matching of ITC with output liability as declared by the supplier.

NOTICE IN THE EVENT OF A MISTAKE
If there is a disparity between the information provided by suppliers and purchasers, it will be communicated to both gatherings, and both parties will be given a chance to make appropriate corrections in their future returns. If the necessary corrections are not performed within the allotted period, receipts are required to reverse the ITC.

REASONS FOR MISMATCH
1. Although the vendor has claimed liability, he has not taken credit in his returns.
2. Despite the fact that the vendor has not claimed responsibility, credit is a factor in his profits.
3. There is a discrepancy between the tax liability and the credit claimed in the returns.
4. Errors in the GSTIN of the supplier/receipts, the invoice number, and the date of the invoice/debit note, and so on.

IMPORTANCE OF GST RECONCILIATION
1. Only if the invoice is included in the GSTR – 2B will the taxpayer be allowed to claim ITC. As a result, taxpayers are now obliged to reconcile anytime the ITC is calculated based on the purchase register, and GSTR – 2B information is not synchronised.
2. GSTRs are submitted monthly or quarterly.
Finally, after the fiscal year has ended, annual returns must be filed by the 31st of December of the following financial year.
3. GST statutes specify certain dates for making changes to GST returns data or claiming ITC. A registered person may claim input tax credit obtained during the previous year under the terms of section 16 of the CGST Act, 2017.
A. Filing his annual return or
B. 30th September
Whichever is earlier. Therefore reconciliation needs to be done to ensure that all ITC has been considered in GSTR 3B, GSTR 2A and GSTR 2B.
4. As per sub-rule (4) under Rule 36 of the CGST Rules, 2017 a registered person can claim provisional ITC (without invoices on GSTR 2B) to the extent of 5% of ITC appearing in GSTR 2B, meaning if your total ITC is Rs. 1,000 but as per invoices in GSTR 2B your ITC stands at Rs. 700 then you can claim ITC in GSTR 3B up to only Rs. 735 (i.e. Rs. 700 x 105%).