Frequently Asked Questions

It is a question of where the supply goes, not what is supplied. A supply within one State or Union Territory carries two taxes at once — Central GST and State (or UT) GST — levied under section 9 of the CGST Act and the matching State law. A supply that crosses a State border carries a single Integrated GST instead, levied under section 5 of the IGST Act.

The combined rate is the same either way, so the choice does not change what the customer pays — it changes which government collects it and how you report it. What counts as an inter-State supply is defined in section 7 of the IGST Act, and it does not always follow where the goods physically travel.

Input tax credit is the GST you paid on your purchases, set off against the GST you collect on your sales, so that tax applies only to the value you add rather than to the whole price at every stage.

The credit is conditional, and the conditions are where it is usually lost: you need a valid tax invoice, you must have received the goods or services, the supplier must actually have paid the tax to the government, and you must claim within the time allowed. Section 16 of the CGST Act sets them out. Because one condition depends on your supplier rather than on you, reconciling your purchase register against what suppliers have reported is not optional housekeeping.

Both show what your suppliers have reported about you, but they behave differently. GSTR-2A is dynamic: it keeps changing as suppliers file, amend and file late, so the same period looks different depending on when you open it. GSTR-2B is a static statement generated once for a period and frozen, which is why it is the one used for claiming credit.

A figure that reconciles against 2A and not against 2B is usually a timing difference rather than an error — the supplier reported, but after the cut-off. Reconciling purchases against 2A and 2B separates the two.

Normally the supplier collects GST and pays it to the government. Under reverse charge that duty moves to the recipient: you pay the tax on your own purchase directly, rather than paying it to your supplier. It applies to notified categories of supply and to certain purchases from unregistered suppliers, under section 9 of the CGST Act.

Two consequences catch people out. The tax has to be paid in cash rather than settled out of existing credit, and the liability exists whether or not your supplier raised an invoice — so a missed reverse-charge purchase is a shortfall you carry, not one the supplier carries.

GSTR-9 is the annual return. It consolidates a whole financial year of outward supplies, input tax credit and tax paid into one statement, and it is where the year you actually filed is squared against the year as your books record it.

Registered persons must file it, with exemptions for smaller taxpayers below a turnover threshold and separate rules for certain categories such as composition dealers and input service distributors. Larger taxpayers additionally file a reconciliation statement. Thresholds have moved between years, so confirm the one for the year you are filing — the GSTR-9 walkthrough covers preparation from filed data.

In two directions. Outward: your sales register against what you declared in GSTR-1 and paid in GSTR-3B, invoice by invoice rather than in totals, because two errors in opposite directions net off and hide each other. Inward: your purchase register against GSTR-2A and 2B, which is what protects the credit you have claimed.

Differences that cross a financial year are the ones worth isolating first — a document one side declared in a different year is a timing difference, not a missing invoice, and treating it as missing creates a second error. Books against GST returns works through both directions.