Benefits and Limitations of using GSTR- 2B

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Published Date:  26-08-2023   Author:   yash-elwadhi
benefits and limitations of using gstr b

Technology and systems have changed our daily work, and taxation is no exception. GSTR- 2B is a powerful tool helping businesses stay updated about their tax obligations. This blog will discuss the benefits and limitations of using GSTR-2B. Let’s understand more about it in detail.

What is GSTR- 2B?

GSTR-2 B is a statement of input tax credit (ITC) which is auto-generated on the 14th of every month.  You can access this form on the GST portal easily. It makes the process of reconciliation easy for the taxpayers concerning the accounts maintained by them. You can access all the details of the GSTR- 2B form in the GST portal, and this section is identified as the ‘view advisory tab’ on the portal and tells the GSTR- 2B timeline. It can only be viewed or downloaded as xls.

Benefits of GSTR- 2B

The following are the benefits of GSTR- 2B:

1.    Facilitates GSTR- 3B Filing

GSTR- 2B is crucial in reducing the time to file GSTR- 3B, easing the overall process.

2. GST Reconciliation

Reconciliation is the maintenance of records for all the transactions that occur in a specific period. After the introduction of GSTR- 2B, taxpayers can now carry out reconciliation between the details provided in the auto-generated statement and the taxpayer’s book of accounts, and GSTR- 2B reconciliation, This helps confirm that tax credits are accurate and haven’t been charged twice. It’s like a simple check to maintain reliable tax records.

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Read more: Unlocking the Potential of GSTR-2B Reconciliation

3. Increases Accuracy

GSTR- 2B statement decreases the chances of errors and results in more accurate results. Moreover, GSTR- 2B provides real-time insights into tax liabilities and transactions, allowing you to make better decisions.

4. Enhanced Compliance Efficiency

The process of tax return filing is automated in GSTR- 2B, which helps you save a lot of time and effort. Its automated features and data allow businesses to generate correct and compliant tax returns efficiently.

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Limitations of using GSTR- 2B:

1.    Human Interpretation

GSTR- 2B is an auto-populated statement but it requires human decision-making interpretation. And you must ensure that the person handling accounts has the right knowledge about GST and can analyze it.

2. Data Discrepancies

The suppliers upload the data available in GSTR- 2B, and any discrepancies in their filings can impact the accuracy of the information provided.

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3. Evolution of the Tool

The world of GST evolves continuously. The tool may undergo modifications and updates required to align with the regulatory requirements and address user feedback which may lead to increased complexities for the business.

4. Late Return Filing by the Supplier:

The Bottom Line

GSTR-2 B has become a valuable tool that helps in GST compliance for the business. Its benefits, such as simple reconciliation and better accuracy, allow you to scale your business.

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Frequently Asked Questions (FAQs)

1.    How to file GSTR- 2B?

To view and download the GSTR- 2B form for a specific tax period, open Services> Returns> Returns Dashboard> File Returns> GSTR 2B Tile.

2. When the GSTR- 2B form is generated?

Every month, the GSTR- 2B form is generated on the 14th of the next month.

3. What is the aim of GSTR- 2B?

As a taxpayer, you must use the GSTR- 2B form to ensure that you get the correct input tax credit (ITC) on the specific sections of the GSTR- 3B form. However, the taxpayers can only take input tax credit only if the suppliers’ tax invoice is reflected in GSTR- 2B.

4. What is the difference between GSTR- 2A and GSTR- 2B?

GSTR-2A is a dynamic statement updated each time one of the suppliers files their GST return for outbound supplies. At the same time, GSTR- 2B is a static statement that includes details of input tax credit for a specific return period.

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Yash Elwadhi

Yash Elwadhi is a highly skilled and experienced finance content writer with a proven track record of providing insightful and engaging content to a wide range of clients in the financial industry. He has collaborated with prominent financial institutions, fintech companies, and wealth management firms, and is known for his ability to convey complex financial concepts in a clear and engaging manner. Yash is committed to delivering high-quality content that adds value to his clients' target audience and helps them achieve their financial goals.

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