GST Due Diligence

Khandhar Mehta and Shah

Gst due diligence introduction

Goods and Service TAX(GST) ACT requires taxpayers to maintain proper books of accounts, invoices, and other records, and file tax returns on time.

A minor lapse in maintaining the records can result in fines, penalties, and loss of reputation. We provide GST Due Diligence services to identify the business impact of GST, verify if the classification of goods and services are made as per the provisions of the GST Act to avoid any interests or penalties due to late payment or wrong categorization. KMS ensures that the financial information and GST records of the entity are accurately maintained in compliance with the requirements of the law.
Khandhar Mehta and Shah
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Gst due diligence services

Our key services in GST due diligence and GST health check services include the following:

01

understanding of process and system

The GST due diligence experts at KMS employ their knowledge and experience to understand the operations of the client company. It is essential to understand the activities of the company so that they can be classified in a better way according to the GST codes of products and services. We also examine the accounting records maintained and verify if they are adequate, considering the requirements of the GST law. It will give the client a better view of the implications of GST on each product and service and impact on the total GST liability.

02

review of tax codes-sac and hsn codes under gst laws

Our professionals with expertise in GST compliance, return filing, and due diligence, conducts a review of the tax codes applicable to the client company’s activities under GST laws. Our GST professionals help in the identification of the right HSN/SAC code for determining the right tax rate applicable to the supply, accurate GST calculation, and returns filing.

02

review of tax codes-sac and hsn codes under gst lo
Our professionals with expertise in GST compliance, return filing, and due diligence, conducts a review of the tax codes applicable to the client company’s activities under GST laws. Our GST professionals help in the identification of the right HSN/SAC code for determining the right tax rate applicable to the supply, accurate GST calculation, and returns filing.

03

review of gstr-3b

A monthly self-declaration in GSTR-3B is to be filed by all normal taxpayers registered under GST, for providing summarized details of all outward supplies made, input tax credit claimed, tax liability ascertained, and taxes paid. Our GST due diligence consultants help the client companies by conducting a review of the GSTR-3B filed by them to compare it with the GSTR-1. We also engage in responding to the notices sent by relevant departments regarding any unmatched supplies in GSTR-3B and GSTR-1.

04

review of gstr-1

GSTR-1 is the return to be filed by all normal taxpayers who are registered under GST for submitting details of all outward supplies of goods and services (sales transactions) during a tax period, and also for reporting debit and credit notes issued. Moreover, any amendments to sales invoices made, even pertaining to previous tax periods, must be reported in the GSTR-1 return. It is filed monthly, except in the case of small taxpayers with turnover up to INR 1.5 crores in the previous financial year, who can submit the same on a quarterly basis.

The GST due diligence professionals at KMS review the GSTR-1 records to ensure that they match with the sales recorded in the book of accounts. We keep a check on all the amounts recovered from employees, penalties recovered from customers or vendors, inter-state stock transfer records, and GST charged on FOC transactions or free samples.

04

review of gstr-1
GSTR-1 is the return to be filed by all normal taxpayers who are registered under GST for submitting details of all outward supplies of goods and services (sales transactions) during a tax period, and also for reporting debit and credit notes issued. Moreover, any amendments to sales invoices made, even pertaining to previous tax periods, must be reported in the GSTR-1 return. It is filed monthly, except in the case of small taxpayers with turnover up to INR 1.5 crores in the previous financial year, who can submit the same on a quarterly basis.

The GST due diligence professionals at KMS review the GSTR-1 records to ensure that they match with the sales recorded in the book of accounts. We keep a check on all the amounts recovered from employees, penalties recovered from customers or vendors, inter-state stock transfer records, and GST charged on FOC transactions or free samples.

05

HANDLING THE PLACE OF SUPPLY AND TIME OF SUPPLY DETAILS

We assist our clients with the identification of the correct “place of supply” to determine the type of GST applicable to the supply - CGST, SGST, or IGST. Our due diligence experts handle the review of invoices verify “bill to” and “ship to” details diligently to avoid any interest or penalty payments in case of the incorrect heading of GST.

The “time of supply” is also an essential factor in ensuring that the GST liability under the GST laws has been discharged at the right time. Along with the internal experts of our client companies, our GST advisors identify the time of supply of transactions to avoid any interest on account of delay in GST payments.

06

managing transactions related to input tax credit

We assist the clients in availing input tax credit. Our GST due diligence experts have the required proficiency to check for the receipt of goods/services, receipt of tax invoice, filing of GST return by the vendor, payment of GST by a vendor to the government, and payment made to the vendor against the tax invoice within 180 days before making the input tax credit available to the clients.

The GST professionals of KMS ensure correct treatment of input tax credit in case of reconciliation of books versus GST returns, exempted/non-GST supply, supply under warranty, matching of the input tax credit in GSTR 3B versus GSTR 2A, and free samples / FOC transactions.

06

managing transactions related to input tax credit
We assist the clients in availing input tax credit. Our GST due diligence experts have the required proficiency to check for the receipt of goods/services, receipt of tax invoice, filing of GST return by the vendor, payment of GST by a vendor to the government, and payment made to the vendor against the tax invoice within 180 days before making the input tax credit available to the clients.

The GST professionals of KMS ensure correct treatment of input tax credit in case of reconciliation of books versus GST returns, exempted/non-GST supply, supply under warranty, matching of the input tax credit in GSTR 3B versus GSTR 2A, and free samples / FOC transactions.

07

heandilng the reverse charge mechanism

We enable the clients to ensure that they comply with reverse charge mechanism provisions by paying taxes on all the inward supplies. Such supplies include import of services, legal services, sponsorship services, transport of goods by sea, any charges for services carried out by Goods Transport Agency, arbitration services, and director’s services.

08

Consultancy for GST Compliance Software Selection and Development

We provide consultancy services for GST compliance software selection. We carry out requirement analysis for your business and suggest you the best GST compliance software considering your requirements.

Our GST consultants also assist you in GST compliance software development. We provide the domain knowledge and help you incorporate GST related requirements in your GST compliance software.

08

Consultancy for GST Compliance Software Selection and Development
We provide consultancy services for GST compliance software selection. We carry out requirement analysis for your business and suggest you the best GST compliance software considering your requirements.

Our GST consultants also assist you in GST compliance software development. We provide the domain knowledge and help you incorporate GST related requirements in your GST compliance software.

09

Any other reviews

KMS’s GST due diligence experts are adept in handling and managing any other review that may include formatting of invoices, and documents as per GST laws. We also help in preparing sample invoices, verifying documents, and other services related to essential systems and accounting related aspects.

why kms?

GST Health Check Services

We recommend our clients the best possible GST solutions and strategies in the given circumstances and also assist them with their implementation and execution. Our GST Consulting team aims at catering hassle-free and speedy delivery of GST due diligence related services.
We have the best team of GST advisors who have the required knowledge in understanding the GST-related concepts and have the practical experience of dealing with GST-related transactions for different industry sectors.
Since the GST law is still new, and the categorization of related transactions might get confusing. We ensure that we have the best consultants engaged in the allocation of tax codes and do a double check on these codes to avoid any wrong code categorization of supplies and thus avoid any interest payments on the part of the client.
KMS boasts of a bunch of people who are proactive, steadfast, and meticulous in their approach to handling any GST due diligence services. They are also experts in providing GST advisory, transition, training, and GST health check services to our client companies.

our clients say

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frequently asked questions(faqs)

GST due diligence means to investigate and assess the impact of GST on a company’s operations from a financial, operational, commercial, and strategic perspective.

Input credit is defined as the reduction of the tax amount that is already paid on the inputs from the tax amount to be paid on the output.

 

Harmonized System of Nomenclature (HSN) Code is a six-digit uniform code used across the world for a systemic classification of more than 5000 products. These codes ensure uniformity in taxation across the world and ease in doing business and are used in filing returns, invoices, and others.

Services Accounting Code (SAC) are codes used for classification of services under GST to be used in making invoices.