In this article you will learn:
Under the new GST return system, forms GST ANX – 1 AND GST ANX – 2 have been included to supplement the main return that is GST RET – 1. These annexures are similar to the forms GSTR 1 and GSTR 2A used in the current GST return system.
Currently, the GST Council has launched both these annexures on trial basis. However, this new GST return filing system will be implemented from April 2020, as per the 37th GST Council meeting. Thus, every registered taxpayer, irrespective of his aggregate annual turnover, would be required to file both these annexures along with the main return.
Form GST ANX – 1 reports all the outward supplies, inward supplies under reverse charge and imports undertaken during a particular tax period by a taxpayer. Whereas, GST ANX – 2 reports details pertaining to inward supplies from registered persons, supplies received from SEZ unit or developer and imports undertaken by registered taxpayer.
This article talks about GST ANX – 2. So let’s understand what is GST ANX – 2, components of GST ANX – 2 and instructions to file GST ANX – 2.
What is GST ANX-2?
GST ANX – 2 is an annexure to the main return GST RET – 1. This form is an auto – drafted return that shows the details of inward supplies reported as outward supplies in form GST ANX – 1, Form GSTR 5 and Form GSTR 6.
This means that the details of documents uploaded by corresponding suppliers in GST ANX – 1, GSTR 5 and GSTR 6 will get auto – populated on near real time basis in this annexure.
Further, such a Form is available for the recipient to take necessary action, that is, to accept, reject or keep the documents pending. If the recipient accepts the documents, this would mean that the supplies reported in ANX – 1 are correct.
Components of GST ANX-2
|3. Inward supplies received from a registered person (other than the supplies attracting reverse charge), imports and supplies received from SEZ units/Developers on Bill of Entry|
|3A.||Supplies received from registered persons including services received from SEZ units (other than those attracting reverse charge)||The details of following tables of Form ANX-1 would get auto – populated in this table on near real time basis:|
The recipient has been provided with facility to take action on the auto – populated documents. As a result, the recipient can accept, reject or keep the documents pending on a continuous basis.
|3B.||Import of goods from SEZ units/developers on Bill of Entry|
|3C.||Import of goods from overseas on Bill of Entry|
|4. Summary of the input tax credit|
|1.||Credit on all documents which have been rejected (net of debit /credit notes)||This table showcases the total amount of input tax credit for the tax return period in question on the basis of actions taken by the recipient:|
|2.||Credit on all documents which have been kept pending (net of debit/credit notes)|
|3.||Credit on all documents which have been accepted (including deemed accepted)(net of debit/credit notes)|
|5. ISD credits received (eligible credit only)|
|This table showcases the eligible input tax credit received from an Input Service Distributor. This needs to be updated document-wise.|
Instructions to File GST ANX-2
1. Details Uploaded by the Suppliers get Auto – Populated
You need to keep in mind that GST ANX – 2 is an auto – drafted return. This means that the details of the documents uploaded by corresponding suppliers would get auto – populated in the annexure on near real time basis.
This is irrespective of the fact whether the supplier files his return on a monthly or quarterly basis. Furthermore, the recipient has the ability to accept or reject or unlock the documents before the 10th of the month following the month in which such documents have been uploaded.
2. Recipients are Facilitated to Take Action on Documents
In Form GST ANX – 2 under the new return system, the recipient has been provided with the facility to take action on the auto – populated documents. As a result, the recipient can accept, reject or keep the documents pending on a continuous basis.
He can do so after the 10th of the month subsequent to the month in which such documents have been uploaded.
However, there are cases where the recipient files quarterly returns. In such a scenario, the recipient needs to intimate the supplier about the rejected documents and any additional action on such rejected documents only in the next quarter return.
3. Meaning of Accepted Documents
If the recipient accepts the auto – populated documents, this would mean that the supplies reported in GST ANX – 2 have been received by him before filing of the return. Furthermore, it would also mean that the details provided in the documents that were reported in Form GST ANX – 1 are correct.
Additionally, these accepted documents cannot be amended by the corresponding supplier. However, if there exists any issue pertaining to such accepted documents, the new return system would offer separate facility to deal with such cases.
4. Meaning of Rejected Documents
Typically, if there are any errors in any of the invoices uploaded by the supplier, the same can be corrected through a debit note or credit note. However, there might be cases where the invoices uploaded have errors that cannot be corrected through a debit or credit note. Example, error in HSN code, tax rate value, GSTIN of the recipient etc.
Furthermore, the supplier can make corrections in such rejected documents through form GST ANX – 1 since the rejected documents are shown to the supplier.
5. Meaning of Pending Invoices
Another action or a set of actions that a recipient can take on auto populated documents is to keep them pending. Pending action means that the recipient has postponed the decision to accept or reject the details of the invoices.
Now, there can be various reasons for a recipient to keep the invoices pending These include:
- the recipient is not receiving supplies or
- recipient decides not to take ITC for the time being etc.
Furthermore, the ITC pertaining to such pending invoices shall not be taken into account in the current period’s main return of the recipient. This means that such ITC on pending invoices will not be reported in table 4A of GST RET – 1 of the recipient.
Rather, these invoices would be rolled over to recipient’s form GST ANX – 2 of the next tax period. In addition to this, the supplier will not be able to amend the pending invoices until the recipient rejects such invoices.
6. Deemed Acceptance
There can be scenarios where a recipient does not take any affirmative action on any of the auto – populated documents. This means that he does not perform any of the actions like accepting, rejecting or keeping the documents pending in form GST ANX – 2.
In such cases, it would be deemed that the documents have been accepted by the recipient upon filing of the return. Additionally, the ITC on such deemed accepted documents shall be reflected in table 4A of the recipients main return (Form GST RET -1)
7. Status of Supplier Return
The recipient would be intimated about the supplier’s return filing status in form GST ANX -2 of the tax period in question after the due date of return filing is over.
This status of return filing relates to the fact whether the supplier has filed the return or not. This means that the recipients would be able to check the return filing status of the suppliers.
However, this status would neither impact recipient’s eligibility for ITC or any other aspect of ITC. This is because such eligibility or any other aspect related to ITC would be decided based on the rules of the act.
8. ITC to be Credited Only on Filing ANX – 2
The recipient can avail ITC during a tax period based on the details of documents that the supplier uploads. The supplier must upload such details on or before the 10th of the month subsequent to the month during which the return is filed.
Furthermore, the recipient can avail such credit only after he files his return.
9. Trade Name of the Supplier
GST ANX – 2 would reflect the trade name of the supplier along with his GSTIN. Furthermore, supplier’s legal name would be reported in case his trade name is not available.
10. Functionality to Reject Accepted Documents
The new GST return system would provide separate functionality to search and reject the accepted documents on which the recipient has already availed ITC.
Thus, the ITC availed on such accepted documents would be shown for ITC reversal in table 4B(1) of form GST RET -1.
Whereas, the amount of ITC to be adjusted would be reflected 4A (11) of form GST RET – 1 in order to calculate the total amount of ITC availed. However, the recipient would have to pay interest for such credit reversal as per the rules of the act.
11. GST ANX – 2 Considered as Deemed Filed
Form GST ANX – 2 would be deemed to be filed once the recipient files the main return (form GST RET – 1) pertaining to the current tax period.
12. Details of No Filers
There can be a scenario where a supplier uploads the documents for the month ‘M’. However, he does not file his return for the previous two consecutive tax periods ( i.e. M – 1 and M – 2 months).
In such a scenario, the recipient would be able to view the auto – populated documents in Form GST ANX – 2 along with an indication that ITC on such documents would not be available to him. This means that the recipient can see such documents but he cannot claim ITC on such inward supplies.
Furthermore, there can be cases where the supplier who files return on a quarterly basis fails to do so for previous two consecutive tax periods. In such scenarios, the recipient will not be able to claim credit on such auto – populated invoices until the next quarter.