Understanding and Utilizing the GST ANX-2 Matching Tool for New GST Returns
The GST ANX-2 Matching Tool, a feature of India's updated GST return system, streamlines the reconciliation of a taxpayer's purchase register with supplier-uploaded data. This utility automates the comparison process, identifying discrepancies based on multiple parameters for user review and action. It aims to simplify reconciliation and improve compliance by moving beyond manual matching methods. By categorizing matches and offering refinement options, the tool enhances the accuracy of GST filings.
The updated Goods and Services Tax (GST) return framework introduces a matching utility designed to assist taxpayers in systematically reconciling their purchase records with the data contained in GST ANX-2. This tool facilitates regular comparison of entries, aiming to simplify compliance.
As per an update from March 14, 2020, the new GST return system was slated for implementation in October 2020. Until September 2020, the existing return filing structure, including GSTR-1, GSTR-2A, and GSTR-3B, remained in effect, pending further notifications from the Central Board of Indirect Taxes and Customs (CBIC).
The GST New Return System's Matching Tool
An offline tool, provided with a prototype, allows users to become familiar with the operational capabilities of the new GST returns system. This initiative also serves to gather user feedback. A key feature is the Matching Tool, which enables taxpayers to compare entries in their GST ANX-2 with their Purchase Register. Users can identify and correct disparities between their records and the data submitted by their suppliers.
Availability of the Matching Tool
Starting from July 2019, the new return system, encompassing GST ANX-1 and GST ANX-2, was made available to taxpayers on a trial basis. This trial period did not affect tax liabilities or input tax credits on the back-end.
Distinguishing the Matching Tool from Current GSTR-2A Reconciliation
GSTR-2A is a system-generated return on the GST portal, populated automatically when a supplier files their GSTR-1. In contrast, the recipient maintains their own purchase register. Consequently, mismatches between these two records often arise, necessitating manual reconciliation by the taxpayer to identify and resolve differences.
However, under the new return system, after uploading the purchase register, the Matching Tool automatically compares it with the data supplied by vendors. The recipient's role is then to act upon the identified comparisons, as detailed further below.
Categories of Matching Results
The results are categorized based on seven primary parameters:
- GSTIN
- Document type
- Document number
- Document date
- Total taxable value
- Total tax amount
- Tax amount head-wise
Based on these parameters, users can view six types of matching outcomes:
| Sr. No. | Result | Description |
|---|---|---|
| 1 | Exact Match | All aforementioned parameters align perfectly. |
| 2 | Partial Match | GSTIN and document type match, but a discrepancy exists in only one of the following parameters between GST ANX-2 and the Purchase Register: document number, document date, total taxable value, total tax amount, or tax amount head-wise. |
| 3 | Probable Match | A mismatch is present in either the GSTIN or document type, yet the remaining five parameters are in agreement. |
| 4 | Unmatched | Records are deemed unmatched if GSTIN, document type, document number, and document date all align, but one or more of the following parameters exceed a defined tolerance limit: total taxable value, total tax amount, tax amount head-wise, Integrated tax, Central tax, State/UT tax, or CESS. This implies a matching score of 4 or 5 out of 7 parameters. |
| 5 | In GST ANX-2 but not in Purchase Register | Documents appearing in GST ANX-2 but absent from the Purchase Register fall into this category. |
| 6 | In Purchase Register but not in GST ANX-2 | Documents present in the Purchase Register but not found in GST ANX-2 are classified here. |
Step-by-Step Guide to Using the GST ANX-2 Matching Tool
The following instructions apply to both the offline tool and its prototype, with specific functionalities noted as inactive on the offline version.
Step 1: Access and Log In
- Users should navigate to https://demoofflinetool.gst.gov.in and select 'Proceed to Prototype' if available. Alternatively, the offline tool can be downloaded and installed.
- Click on 'Manage Profile' then 'Add Profile'.
- Enter the GSTIN and click 'Add'. Profiles can be modified after creation.
- After profile creation, select the GSTIN, then add the Financial Year and Tax Period, and click 'Proceed'.
Step 2: Access the Offline Tool Home Screen and Input Details
A screen will appear displaying various functions of the Offline Tool. To manage documents in FORM GST ANX-2, the user must click 'Take Action'.
Step 3: Choose the Matching Tool Option
This feature enables the reconciliation of entries between GST ANX-2 and the purchase register.
Note: A downloadable template is available on the GST Portal, allowing users to maintain their purchase register in a specified Excel/CSV format. This facilitates easy data import and comparison with GST ANX-2 entries.
Step 4: Import and Review Purchase Register
Click 'Import Excel/CSV' to upload the purchase register.
Once imported, click 'View Purchase Register' to examine the details. Users can view purchase register data either by supplier or by document.
Note: The option to remove all imported purchase register entries by clicking 'Remove Purchase Register' is currently not active on the demo tool.
Users can view displayed data in two formats:
- Supplier-wise details: By clicking a specific GSTIN, users can view document details for each supplier, including invoices, debit notes, and credit notes.
- Document-wise details: Users can review individual document details.
In both viewing modes, customization options such as column selection, GSTIN filtering, sorting results, or keyword input are available. Users can also search for a GSTIN and sort results. However, these capabilities are not yet active in the prototype.
Step 5: Initiate Matching Process
Click 'Back', then 'Match' on the purchase register screen to compare entries between the Purchase Register and GST ANX-2.
The matching results will be displayed in a tabular format.
Each 'Match Type' will be hyperlinked, providing access to a summary in tabular form.
Note: This feature is currently not available in the prototype.
Clicking "Match" or "Mismatch" will display a screen allowing users to take specific actions.
Step 6: Refine Matching Results (Currently Inactive)
To refine matching results for tax amounts or document numbers, click 'Refine Matching Result'. This feature is presently not functional.
- Users can set a tolerance limit for tax amount matching, ranging from Rs 0 to Rs 10.
- Enabling 'approximation logic' will ignore minor differences such as missing special characters or zero prefixes/suffixes in document numbers.
Step 7: Apply and Rematch
Click 'Apply and Rematch' to re-execute the matching process based on the refined parameters and selected tolerance limits.
The refined results will show:
- Match with Tolerance: This indicates a match across all parameters after applying the defined tolerance to total tax amounts and individual tax amounts.
- Match with Approximation: This signifies a match across all parameters after applying approximation logic to document numbers and tolerance to total and individual tax amounts.
Note: These functionalities are unavailable in both the offline tool and its prototype.
Step 8: Review Results and Take Action
View the results and click the relevant 'Match type' hyperlink to see details. Sample results are only visible for the following three match types:
- B1(1) Exact match: A sample is provided. By selecting 'Show Purchase Register details', all entries from the Purchase Register are displayed. Records from the Purchase Register are indicated by a grey, italicized row.
- B2(1) Partial match: A sample is provided. Mismatches are highlighted in red. Records from the Purchase Register are displayed in grey rows.
- B2(3) Partial match with approximation: A sample is provided. Records from the Purchase Register are indicated by a grey row.
Actions available on the matching tool:
After the matching results are generated, users can take the following actions:
- Accept: If the auto-populated details in GST ANX-2 are accurate, the user can accept them, and this status will be communicated to the supplier's GST ANX-1.
- Reject: If the auto-populated details in GST ANX-2 are incorrect, the user can reject them, and this status will be communicated to the supplier's GST ANX-1.
- Pending: If the user has not yet confirmed the details in GST ANX-2, they can mark them as 'Pending'. Documents with a 'Pending' status will reappear in GST ANX-2 during the subsequent period.
Note: If a document is not explicitly marked as accepted, rejected, or pending, it will be considered automatically accepted.
The implementation of the new GST return system aims to simplify the often-complex task of filing GST Returns. The prototype and demo tool serve to familiarize users with this new system and gather feedback, ultimately contributing to a more user-friendly final product.