03 March 2021
Hello Everyone, Good Afternoon in the month of nov-20 we were book and pay wrong RCM that means instead of IGST , we were book RCM in SGST and CGST.
how can we will correct it now......???? Please help us..
03 March 2021
Hello Everyone, Good Afternoon in the month of nov-20 we were book and pay wrong RCM that means instead of IGST , we were book RCM in SGST and CGST.
how can we will correct it now......???? Please help us..
27 July 2024
### Correcting the Wrong RCM Booking for GST
Good Afternoon,
To rectify the incorrect RCM (Reverse Charge Mechanism) booking where SGST and CGST were mistakenly used instead of IGST for transactions in November 2020, follow these steps:
#### 1. **Review the Incorrect Entry**
- **Identify Errors:** Review the specific transactions where SGST and CGST were incorrectly booked instead of IGST. - **Verify Details:** Ensure that the incorrect entries are clearly identified, including invoice numbers, amounts, and the nature of the error.
#### 2. **Make the Correct Adjustments**
- **Reverse the Incorrect Entry:** - **Create a Rectification Invoice:** Issue a credit note or a rectification invoice to reverse the incorrectly recorded SGST and CGST. - **Record the Correct Entry:** Rebook the RCM using IGST in your accounts and GST returns.
#### 3. **File an Amendment in GST Returns**
- **Amend the GST Return:** - **For Previous Returns:** Amend the GST return for the relevant period (November 2020). This involves filing a revised return to correct the error. - **GSTR-1:** Amend your GSTR-1 if the incorrect entries were reported in it. - **GSTR-3B:** Amend your GSTR-3B return to reflect the correct IGST and to reverse the incorrect SGST and CGST. - **Use GSTR-9:** For annual reconciliation, ensure that the corrected entries are reflected in the annual return (GSTR-9).
#### 4. **Adjust Tax Liability and Input Credit**
- **Correct the Tax Liability:** - Ensure that the total tax liability is correctly reported in your GST returns. - If there is any excess payment due to the incorrect booking, you might be eligible for a refund or adjustment.
- **Adjust Input Tax Credit:** - If you claimed input tax credit incorrectly, reverse the credit claimed on SGST and CGST and correctly claim the credit for IGST.
#### 5. **Consult with a Tax Professional**
- **Seek Expert Advice:** Given the complexity of GST compliance and the potential impact on your financials, consult with a GST advisor or tax professional to ensure accurate corrections and compliance.
### Summary of Actions
1. **Reverse Incorrect Entries:** - Issue a credit note for SGST and CGST. - Rebook RCM with IGST.
2. **File Corrected Returns:** - Amend GSTR-1 and GSTR-3B for November 2020. - Reflect changes in the annual return (GSTR-9).
3. **Adjust Financials:** - Correct tax liabilities and input credits.
4. **Consult a Professional:** - For accurate handling and compliance.
This process will help in correcting the GST entries and ensuring accurate reporting.
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