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GST Audit: A Necessary Evil or Just Routine Check?
Now, before you panic, remember—A GST audit doesn’t necessarily mean something is wrong. Think of it like a financial health check-up. If all is well, you get a clean report. If not, well… let’s just say, it’s better to know sooner rather than later.
- Verify the correctness of turnover declared
- Ensure proper tax payments
- Check ITC (Input Tax Credit) claims
- Identify any errors or misreporting (intentional or otherwise)
GST audits can be tricky, but with Compliance Monk, you’re always a step ahead. From accurate turnover calculations to seamless GSTR-9C filings, we ensure your records are audit-ready and error-free.
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Reliable Support
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GST Audit
🔍 What is GST Audit?
GST audit is a detailed examination of a taxpayer’s records, returns, and documents. In short, it’s the government’s way of saying, “We trust you, but let’s verify.”
A GST audit isn’t just another tax compliance requirement—it’s the government’s criteria to ensure businesses are playing fair. The idea is simple: businesses assess their own tax liability under GST, but sometimes, a little double-checking is necessary. And that’s where GST audits come in.
💼 Who Needs to Get Their GST Accounts Audited?
Not every business is lucky enough to qualify for a GST audit (yes, we said lucky). So, if your annual turnover is more than ₹5 crore, congratulations—you just won yourself an audit (or at least, a self-certification process).
📊 How is Turnover Calculated for GST Audit?
Understanding turnover is crucial because it determines whether you need an audit. Your aggregate turnover includes:
✅ Taxable supplies (both interstate and intrastate)
✅ Exempt supplies (yes, even tax-free income counts!)
✅ Exported goods and services
✅ Supplies by job workers or agents on behalf of a principal
🚨 What’s NOT included?
❌ Reverse charge inward supplies
❌ GST taxes (CGST, SGST, IGST, etc.)
❌ Activities that are neither goods nor services (like employee salaries)
If your PAN-based aggregate turnover exceeds ₹5 crore, GSTR-9C self-certification is mandatory.
🎯 Why is GST Audit Required?
While businesses are expected to self-assess their tax liability, audits help:
- Ensure compliance with GST laws
- Detect and correct errors in tax filings
- Prevent tax evasion (because, let’s face it, not everyone plays fair)
- Maintain transparency in the taxation system
So, whether you’re a tax wizard or just figuring out GST, audits are here to keep everyone accountable.
📝 Documents to Be Maintained for GST Audit
- Sales Register 📊
- Stock Register 📦
- Purchase Register & Expenses Ledger 🧾
- ITC Claimed & Utilized 💰
- GST Returns (GSTR-1, 3B, 9, 9C, etc.) 📄
- E-way Bills & E-invoices 🚚
Keeping these documents handy can save you from last-minute panic when the tax department comes knocking.
🚨 Penalty for Not Filing GST Audit Reports
Unlike income tax audits, there’s no specific penalty under GST. However, non-compliance can attract a general penalty of ₹25,000.
👉 Pro Tips:
- Missing deadlines can lead to unnecessary scrutiny and tax demands. Avoid late filings and keep your records tidy!
- A GST audit may seem like a daunting process, but if your records are in order, you have nothing to worry about.
- If you’re above the ₹5 crore threshold, just ensure your GSTR-9C is self-certified and filed on time.
Why Choose Compliance Monk?
Whether it’s a routine GST audit or a departmental scrutiny, we’ve got your back with expert guidance and hassle-free compliance.
Our experts handle reconciliation, documentation, and on-time filings—so you never miss a deadline or face unnecessary penalties.
- File returns on time (GSTR-1, 3B, 9, and 9C)
- Maintain proper records (sales, purchases, stock, ITC claims)
- Ensure reconciliation between books and GST returns
- Stay updated on rule changes (because tax laws love to evolve)
FAQs
1. What is a GST audit?
A GST audit is the examination of financial records, returns, and other documents of a registered taxpayer to verify the accuracy of tax payments, refunds claimed, and compliance with GST laws.
2. Why is a GST audit required?
GST audits ensure that businesses correctly assess their tax liabilities, maintain transparency, and comply with GST regulations. It helps prevent errors, tax evasion, and legal complications.
3. Who is required to undergo a GST audit?
Businesses with an annual aggregate turnover exceeding ₹2 crore (as per earlier provisions) were required to get their accounts audited by a Chartered Accountant or Cost Accountant. However, from FY 2020-21 onwards, the requirement for CA/CMA certification has been removed, and self-certification is required for businesses with a turnover exceeding ₹5 crore.
4. What are the types of GST audits?
- Turnover-based Audit – Conducted by a CA/CMA for businesses exceeding the prescribed turnover limit (now self-certified).
- Departmental Audit – Conducted by tax authorities based on an order from the Commissioner.
- Special Audit – Ordered by the Assistant Commissioner with prior approval of the Commissioner in cases of suspected misreporting.
5. How is turnover calculated for GST audit applicability?
Aggregate turnover includes taxable supplies, exempt supplies, exports, and inter-state supplies but excludes inward supplies liable for reverse charge and GST taxes (CGST, SGST, IGST).
6. What forms are applicable for GST audit?
- GSTR-9 – Annual return for regular taxpayers.
- GSTR-9A – Annual return for composition taxpayers (now discontinued).
- GSTR-9C – Reconciliation statement (self-certified for businesses above ₹5 crore turnover).
7. What documents are required for a GST audit?
Key documents include financial statements, GST returns, sales and purchase registers, input tax credit records, and reconciliation statements.
8. What is the due date for filing GST audit reports?
GSTR-9 and GSTR-9C must be filed by 31st December of the following financial year unless extended by the government.
9. What happens if I fail to submit the GST audit report?
Non-filing may attract a general penalty of ₹25,000, along with interest and additional liabilities in case of tax discrepancies.