Excess input reverse through drc-03 or gstr-3b

This query is : Resolved

jaigurudev (Querist)
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30 May 2021 dear sir,
i have taken excess input in gstr-3b of 20202021 and know i want to reverse this amount
please advice can i pay this amount through drc-03 as if i reverse this amount in 20212022 again differance will show in current year
with thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 May 2021 Reverse it in GSTR 3b in current year that is the right way. In the annual return it's taken to last year.

jaigurudev

jaigurudev (Querist)
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30 May 2021 respected sir, if i reverse in 21-22 itc mismatch will not occur?is drc-03 is not correct?
with thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 May 2021 Mismatch will not be there. DRC03 is not correct.

CA Altamush Zafar

CA Altamush Zafar (Expert)
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31 May 2021 If ITC belongs to previous year and in books entries are correct reverse ITC through DRC-03. If the excess ITC belongs to current year adjust it in the next month's GSTR-3B

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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31 May 2021 Reversal allowed upto September next year. Guide properly.

CA Altamush Zafar

CA Altamush Zafar (Expert)
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31 May 2021 Reversal allowed for life. Department won't say that now the time limit has passed you shouldn't reverse.
Reversing through Drc-03 is recommended in year change because the difference between books and returns will remain in one year only. Rectifying through gstr-3b will impact both year's reconciliation.
Impact is same but with less reconciliation.

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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31 May 2021 Agree with Seetharaman.
On the contrary, if someone misses to avail ITC during the year, there is a time limit up to Sep to avail ITC in which case reconciliation is anyway a necessity.

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