Reconcile GSTR-2B before the department does
The GST portal compares what you claim in GSTR-3B with what your suppliers have reported, as shown in your GSTR-2B. Large differences are flagged automatically, and they are one of the most common reasons for scrutiny notices and demands. The way to avoid them is to reconcile every month, before you file.
Why GSTR-2B matters
Under section 16(2)(aa) of the CGST Act, credit is available only if the invoice has been furnished by the supplier and communicated to you, which in practice means it appears in GSTR-2B. GSTR-2B is a static statement generated for each return period, after taking into account the actions you take on the Invoice Management System (IMS).
A monthly routine
- Act on the IMS before GSTR-2B is generated: accept invoices you have received, reject wrong ones, and keep doubtful ones pending.
- Download GSTR-2B for the month and match it, invoice by invoice, with your purchase register.
- In your books but not in GSTR-2B: ask the supplier to file or correct the invoice. Do not claim the credit until it appears.
- In GSTR-2B but not in your books: check whether the purchase is genuine and whether it has simply been booked late.
- Remove blocked and ineligible credit, such as credits under section 17(5) and credit relating to exempt supplies.
- Claim in GSTR-3B only what has passed these checks, and keep the reconciliation as a working paper.
Deadlines and reversals to watch
- Credit for a financial year must be claimed by 30 November of the following year, or the date of filing the annual return, if earlier.
- If you do not pay the supplier within 180 days of the invoice date, the credit must be reversed until you pay.
- Credit wrongly availed and used attracts interest at 18% a year.
Read the full guide: input tax credit and GSTR-2B reconciliation.