GSTN issues advisory on delinking of Credit/Debit Note from the invoice or filing Refund

The GSTN portal has issued the Advisory issued on Delinking of Credit/Debit Note from Tax Invoice.

Let’s understand in detail – 

Advisory issued by GSTN

GSTN has issued the formal advisory in regard to delinking of Credit/Debit Note facility which has given below for the ready reference of our readers.

It was also intimated that such facility was much awaited given amendments in Section 34(1) and 34(3) of the CGST Act,2017 which were made effective from 01-02-2019.

The move is much required to decrease the disclosures by a taxpayer on the GST portal and, in turn, the compliance burden. Moreover, companies will not face practical difficulties when they issue a single credit or debit note against multiple invoices, where tagging of one CDN against every invoice is not possible.

Till now, the original invoice number was compulsorily needed to be quoted by the taxpayers, while reporting a Credit Note or Debit Note in Form GSTR-1 or Form GSTR-6.

Now, after more than one and a half year of the amendment, GSTN has certainly enabled delinking of Credit/Debit Note facility to report consolidated credit or debit note under GST in GSTR-1.

Know About Credit Note and Debit Note

The credit note has considered when Original tax invoice has been issued and taxable value in the invoice exceeds the actual taxable value. However, Debit note consider as a document, which can also use as evidence to reflect that a debit is made to the seller’s account. 

A debit note or a Credit Note has considered in 2 situations –

• When the amount payable by the buyer to seller decreases 
• When the amount payable by the buyer to seller increases

Benefits provided to taxpayers

The taxpayers have now been provided with a facility in the GST Return Filing Portal to:

• The report in their Form GSTR-1 or in Form GSTR-6, single credit note or debit note allotted in respect of multiple invoices
• Select the note supply type as Regular, SEZ, DE, Export etc.
• Designate Place of Supply (POS) against each credit note or debit note, to identify the supply type i.e. Intra-State or Inter-State
• Delinking of Debit /Credit Notes can list with tax amount, but without any taxable value. 
• Also, if credit note or debit note allotted for the difference in tax rate only,
• then note value can report as ‘Zero’. Also, the only tax amount will have to enter in such cases.
• Similar changes have made while reporting measures to credit note or debit note.

Corresponding changes made in refund module:

Corresponding changes have also made in the refund module. The change has been provided while filing refund application of following types/ cases:

• Reimbursement for export of services including payment of tax
• Refund on account of goods & services without payment of tax
• Refund of production of goods or services to SEZ covering payment of tax
• Return of supply of goods or services to SEZ excluding payment of tax
• Reimburse on account of Inverted duty structure

TCS functionality on GSTR-8 Return enables for GST Composite Taxpayers

In case, you need any kind of guidance related to the GST registration, GST return filing procedure, or any other GST compliance, please feel easy to contact our business advisors at 8881-069-069.

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