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GSTR-2

Last updated on 20 September, 2017

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GST return for purchases and inward supplies


What is the GSTR-2?

The GSTR-2 is a monthly tax return showing the purchases you’ve made for that month. When you make purchases from registered vendors, the information from their sales returns (GSTR-1) will be available in the GSTN portal as GSTR-2A for you to use in your GSTR-2. Before you file your return, you can check this information, make changes if necessary, and add any details that were not auto-populated.

If you change the information on your GSTR-2A and file it as GSTR-2, the vendor will be notified and given a chance to amend their return using a GSTR-1A form.   

Dates associated with the GSTR-2

Prerequisites of the GSTR-2

To file the GSTR-2:

Contents of the GSTR-2

The first section asks for the year and the month for which the GSTR-2 is filed. The following sections ask for the tax details from that period.

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  1. 13. HSN summary of inward supplies - Provide an HSN-wise summary of the items purchased by you including total quantity purchased, taxable value under each tax heading, and Unit Quantity Codes (for imports).

GSTR2

At the end of the document, there is a declaration of truth that needs to be signed by the authorized signatory of your company.

Note : If you are using a GST compliant accounting and tax filing software (like Zoho Books), then the GSTR-2 will be auto-generated based on the transactions you record in the software. You can then push, reconcile and file this return directly into the GSTN.

GSTR-2 for different businesses

There are 13 tables and sections under GSTR-2. While each one is meant to capture a particular aspect of your purchases and inward supplies made under GST, not all of them are mandatory for every business (except for tables 1, 2, and 13 which are mandatory for all businesses). Hence, we have come up with a list of applicable GSTR-1 fields for a few business models.

There are 4 things under GST that dictate the type of information you need to file within GSTR-2: 

The vendors you buy goods and services from

Customers and channels who deduct tax on your behalf

Why do we talk about customers and sales channels in GSTR-2? Well that’s because, one of the main objectives of GSTR-2 is to keep track of the tax you paid to other registered persons who do business with you (and there by calculate the amount of tax refund that you can avail as credits). 

The nature of supplies you receive

Under the GST regime you can receive 4 kinds of supplies - Taxable supplies/GST supplies, Nil rated supplies, Exempt supplies and Non-GST supplies. You can learn more about each kind of supply here.

How you utilize your inward supplies

Whenever you make a purchase, you as a registered taxpayer is legally required to pay the tax associated with those items and/or services (also known as input tax). Now this tax you paid on inputs will be refunded to you under certain conditions:

What happens when you don’t meet the above conditions? Well, under the GST law, you are supposed to surrender the input tax credit received on items or services that you have used for non-business purposes, for carrying ut activities under section 17(5) of the GST Act 2017 and for making supplies of items and/or services that are exempted under GST. This is basically captured under table 11.

You are also required to return the input tax credit that you may have received in excess due to modifications made to purchase transactions, duplicate purchase entries and mismatched transactions. This is captured under table 12.

Penalties

Failing to file the GSTR-2 for a particular month on or before the due date (15th of the following month will attract a late fee for everyday you delay the filing process. You will be fined Rs. 100 per day, up to a maximum of Rs. 5,000.



       
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