10 Common Mistakes to Avoid While Filing GST Returns in India


10 Common Mistakes to Avoid While Filing GST Returns in India


Since GST has replaced several levies like excise duty, service tax and value added tax (VAT), it's become a necessity for businesses to be compliant with the new law. However, even the best-established business can run into trouble if they fail to follow the correct procedures when filing returns and making payments. This can lead to unanticipated cash flows and can have a direct impact on bottom line liquidity and short term working capital. Moreover, non-compliance can also lead to heavy penalties and a bad reputation with the authorities.

The GST return filing system is complex and requires a lot of manual data entry to generate reports. It's common for human error to occur during this process which can lead to mistakes in GST filing and compliance. To help you avoid the mistakes that can cause trouble, here are 10 Common mistakes to avoid while filing GST Returns in India.

1. Filing Under Wrong Head: It's common for taxpayers to register their GST liabilities and input tax credit under the wrong heading. This can result in unfavourable cash flow, reversal of tax payments and other calculation errors. To prevent this, businesses should ensure that the HSN and Services Accounting Codes in GSTR-1 are accurate. Also, they should make sure that all taxable and exempt supplies are correctly reported in GSTR-1.

2. Not Reconciling GSTR-3B and GSTR-1: Businesses should reconcile their GSTR-3B and GSTR-1 returns on a regular basis to make sure that all data is accurate. This will ensure that they are paying the right amount of taxes and receiving the correct amount of ITC.

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