GST - REVIEW SERVICES

From the introduction of GST law to date, we have seen innumerable Notifications, Circulars, changes in GST law and we could expect regular developments in the GST law as GST council would be considering the interests of various stakeholders from time to time. The level and need of compliance are also high in GST and organization may need help of professionals to ensure compliance with changing law. We may provide assistance in ensuring compliance by conducting GST compliance review on periodical basis covering all functions having impact in GST. This could include sales, procurements, inventory, finance etc. Such review would also be helpful for GST annual audit which is mandatory as per GST provisions for assesses with turnover of more than Rs.2 crore in a financial year. Periodical review could help the organization to ensure compliance, take benefits of credits, update with changes in rate of taxes etc. Broadly, this would cover the following:

• Review of GST outward supplies, tax rates applied, concessions, exemptions claimed, fulfillment of related conditions, export benefits claimed etc.
• Review of GST input tax credits claimed to assess eligibility, ineligibility, completeness, documentation for credits, transitional credits carry forward etc.
• Review of procedural compliances including GST registrations obtained, payment of taxes, filing of returns, disclosure of ITC & outward supplies in returns, movement of goods for job work, carry forward of credits etc.
• Review of reverse charge compliance by reviewing the expense ledgers on sampling basis, payments made, availment of re-credit after payment, eligibility of such credits, rate and abatements if any claimed including documentation.
• Review of internal controls and processes and suggestions on improvement considering GST law compliance.

Review could also be conducted for specified areas as discussed below:

Specific areas review: Area specific reviews could also be a need of few organisations such as sales, procurements, exports, GST credits, refunds etc. We carry out area specific review to meet the purpose.

Review of systems: Compliance burden in GST is high as many of the processes are being automated. There is need for having proper system in place as to process, procedures, documentations and other aspects for easy compliance. We could assist in designing the systems by reviewing the systems to suit the business requirement and at the same time, ensure the full compliance of GST.

Agreement review: Review of existing agreements and suggestion could be provided for compliance with GST and optimizing the benefits.

Review of disputes and refund cases: Advent of GST has resulted in repeal of indirect taxes such as service tax, central excise and VAT. There is need for assessing the impact of GST on pending disputed cases and refund claims. We assess the impact of these cases under new regime and suggest the course of actions to be taken to mitigate the adverse impact.

In business restructuring deals, tax due diligence of buyer side is required. This may require to be done voluntarily by buyer or based on specific direction by seller. The review is intended to highlight the tax exposure which may carry to new entity. This becomes more critical in cases where entity is exposed to multiple indirect tax laws. We are also seeing an increased litigation from the GST departments, the litigation process towards which may spill over after the business restructuring. We have tax experts having in-depth knowledge in due diligence review to support the parties to deal or other professional advisors. The team identifies areas of non-compliance, potential threats thereof and suggest remedial measures. Based on review, we can suggest alternative structuring strategy to optimise tax incidence.

The department has started their audits and are issuing notices, demands in singificant volume. Departmental audit is undertaken to gauge revenue leakage. This may ultimately culminate into litigation proceeding against the assessees. The cost of such unearthing is very high especially due to higher rate of interest and imposition of penalty upto 100%. With our experience, we know the possible target areas of department and methodology adopted for audit. We carry out the review before department officers come to your office and highlight areas which need immediate actions to minimise/avoid the risk of possible future litigation. Our Partners are also authors of a book titled “GST Audit Handbook - Government Perspective”.

In recent years, reporting obligations of statutory, tax and internal auditor have increased manifold. They are required to mention the extent of non compliance under indirect taxation also. We support chartered accountants and other professionals in undertaking compliance review during the course of their statutory, tax and internal audit so that they are able to meet their statutory obligations. This sometimes, also opens up huge tax planning opportunities for the client.