Accounts and Records under GST

Accounts and Records under GST – 16 Important Questions Answered. Hopefully GST will be implemented by July 1, 2017. On bringing GST into practice, there would be merger of Central and State taxes into a single tax payment. The CAknowledge is striving to organise more and more workshops and lecture meets on GST. This article explains Accounts and Records as per Goods & Service Tax Act 2017, GST effective date, Short term and long term impact on GST & latest updates related to Accounts and Records under GST Regime. Lets understand what is the Accounts and Records under GST, Applicability of GST in GST Regime, GST rates, its impact on your business and latest updates about GST Act 2017. Now check more details for Accounts and Records as per CGST Act 2017…

Q1. Should every registered person required to maintain books of account?

Ans. Yes. As per Section 35 of the Act, every registered person is required to keep and maintain books of account at his principal place of business that is mentioned in the certificate of registration.

Q2. What are the basic accounts required to be maintained by a person at the principal place of business?

Ans. As per Section 35 of the Act, read with Draft Accounts and Records Rules, the following accounts need to be maintained on a true and correct basis:

(a) Production or manufacture of goods;
(b) Inward or outward supply of goods or services of both;
(c) Stock of goods;
(d) Input tax credit availed;
(e) Output tax payable and paid;

Q3. What are the additional accounts to be maintained by the registered person under Rule 1 of Accounts and Records Rules, 2017?

Ans. Every registered person, in addition to the records to be maintained under section 35 of the Act, is required to maintain following additional accounts on a true and correct basis:

Goods or services imported or exported;
Supplies attracting reverse charge along with documents (including invoices, bill of supply, delivery challans, credit notes, debit notes, receipt vouchers, payment vouchers, refund vouchers and e-way bills);
Accounts of stock for each commodity received and supplied – containing particulars of opening balance, receipt, supply, goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples and balance of stock including raw materials, finished goods, scrap and wastage thereof (these details need not be maintained by a composition dealer)
Advances received, paid and adjustments thereto;
Tax payable on reverse charge basis;
Tax payable, tax collected and paid, input tax, input tax credit claimed, together with a register of tax invoice, credit note, debit note, delivery challan issued or received during any tax period;
names and complete addresses of suppliers from whom he has received the goods or services;
names and complete addresses of the persons to whom he has supplied the goods or services; and
the complete addresses of the premises where the goods are stored by him, including goods stored during transit along with the particulars of the stock stored therein.

Q4. Is an agent required to maintain any set of books of accounts?

Ans. Yes, as per Rule 1(12) of Accounts and Records Rules, 2017 every agent referred in section 2(5) shall maintain accounts containing:

particulars of authorization received by him from each principal to receive or supply goods or services on behalf of such principal separately;
particulars including description, value and quantity(wherever applicable) of goods or services received on behalf of every principal;
particulars including description, value and quantity(wherever applicable) of goods or services supplied on behalf of every principal;
details of accounts furnished to every principal; and
tax paid on receipts or on supply of goods or services effected on behalf of every principal.

Q5. Is there any specific set of records to be maintained by the provider of works contract service?

Ans. Yes as per Rule 1(15) of Accounts and Records Rules, 2017 the registered person providing works contract service shall maintain the accounts showing-

the names and addresses of the persons on whose behalf the works contract is executed;
description, value and quantity (wherever applicable) of goods or services received for the execution of works contract;
description, value and quantity(wherever applicable) of goods or services utilized in the execution of each works contract;
the details of payment received in respect of each works contract; and
the names and addresses of suppliers from whom he has received goods or services.

Q6. Is there any specific record to be maintained by custodian of goods?

Ans. Yes, as per Rule 1(18) of Accounts and Records Rules, 2017 , the clearing and forwarding agent or the carrier of goods shall maintain true and correct records in respect of such goods handled by him on behalf of the registered person.

Q7. Where are the books of account liable to be maintained?

Ans. The books of account are to be maintained at principal place of business as mentioned in the certificate of registration.

Q8. In case of more than one place of business, the records are required to be maintained only at principal place of business?

Ans. No, in case of additional places of business, the accounts relating to each place of business shall be kept at such places of business concerned (provided such place is specified in the certificate of registration).

Q9. Whether accounts can be maintained in the electronic form?

Ans. Yes, the registered person may keep and maintain such accounts and other particulars in the electronic form, in the manner as may be prescribed.

Q10. Is there any category of registered person required to maintain additional accounts or documents?

Ans. The Commissioner/Chief Commissioner may notify a class of taxable persons to maintain additional accounts or documents for such purpose as may be specified.

Q11. Can an exception be made for maintenance of books of account as per provisions of Section 35 of the GST Act?

Ans. Yes, in case any class of taxable persons is not in a position to keep and maintain accounts in accordance with the provisions of this section, the Commissioner/ Chief Commissioner may permit such class of taxable persons to maintain accounts in such manner as may be prescribed after recording the reasons for the same.

Q12. Whether the accounts maintained by the registered taxable person needs to be audited?

Ans. Yes, every registered person whose turnover during a financial year exceeds the prescribed limit of Rs. one crore, shall get his accounts audited by a chartered accountant or a cost accountant and shall submit to the proper officer a copy of the audited statement of accounts, the reconciliation statement under Section 44(2) and such other documents in the form and manner as may be prescribed in this behalf.

Q13. Can the provisions of Sections 73 or 74 be made applicable for not maintaining books of account?

Ans. Yes, where the registered person fails to account for the goods and/or services in accordance with Section 35(1), the proper officer shall determine the amount of tax payable on the goods and/or services that are not accounted for, as if such goods and/or services had been supplied by such person and in this regard, and the provisions of Sections 73 or 74, as the case may be, shall apply, mutatis mutandis, for determination of such tax.

Q14. Does the law require an owner/ operator of a warehouse or godowns/ transporter to maintain books of account?

Ans. Yes, every owner/ operator of warehouse or godowns or any other place used for storage of goods and transporter (whether registered or not) needs to maintain records of consigner, consignee and other relevant details as under:

1. For Transporter:

Goods transported
Goods delivered
Goods stored in transit by him and branches

2. For owner/ operator of a warehouse or godowns:

Accounts related to that period for which goods remain with him
Details of dispatch, movement, receipt and disposal

Further, owner/ operator of warehouse or godowns should store the goods in such a way that identification item-wise and owner-wise is possible and facilitates physical verification/ inspection..

Q15. Is there any form to be submitted by the such persons to maintain books as per section 35?

Ans. Yes, as per Accounts and Records Rules, 2017, owner/ operator of warehouse or godowns or any other place used for storage of goods and transporter if not registered is required to submit the details regarding his business electronically on the Common Portal in FORM GST ENR-01, either directly or through a Facilitation Centre notified by the Commissioner and, upon validation of the details furnished, a unique enrollment number shall be generated and communicated to the said person.

Q16. Is there any specific set of details to be maintained by a supplier of service?

Ans. Yes. As per Rule 1(14) of Accounts and Records Rules, 2017, a supplier of service is required to maintain quantitative details of goods used in provision of each service, details of input service utilized and services supplied.

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