What is the Monthly Tax and ITC Summary Report?


Date: 17 Aug 2022

What is the Monthly Tax and ITC Summary Report?


The Monthly Tax and ITC Summary Report may be used to analyse and maintain track of the output taxes paid and the input tax credit used within any given period. When completing yearly returns, the taxpayer must provide a detailed accounting of all taxes paid and input tax credits taken throughout the year. The report may be compared to the books of account, making it simple to spot discrepancies.


Importance of the Monthly Tax and ITC Summary Report

  • Annual GST liability should be declared simultaneously as monthly GST obligations. The Monthly Tax and ITC Summary Report facilitates simple data comparisons in this area.

  • If a taxpayer wants to be sure that they have claimed all available input tax credits, knowing how much of those credits were paid for by cash and how much by credit is helpful.

  • This report assists the taxpayer in closing his books for the fiscal year by allowing him to compare his records to the returns he has already filed.

  • This report may be used to reduce the likelihood of receiving a warning from the tax agency owing to underreported tax obligation or overstated credit.


Reasons for mismatches in the books of accounts and the Monthly Tax and ITC Summary Report

There are a few potential causes for a discrepancy between the books and the Monthly Tax and ITC summary report:

  • According to the ledgers, a revenue invoice issued in one month was reported in the returns for the next month.

  • The input tax credit is claimed in a separate filing period instead of the period in which the invoice was raised.

  • Input tax credits might be reversed unless suppliers are paid within the allotted time frame.

  • Due to mistakes made while submitting returns and then corrected in subsequent months' filings, there may be discrepancies between the returns and books of accounts.


Reconciliation at filing the Annual return: The monthly tax obligation must agree with the liability indicated in the yearly return. Thus the two must be reconciled. As such, the GST purchases that qualify for input tax credit should match the monthly input tax credit claimed.


This method not only facilitates the closing of a taxpayer's books but also aids in filing yearly returns. It would also help prevent the taxpayer from receiving notifications owing to differences between their monthly and annual GST filings.


Advantages of the Monthly Tax and ITC Summary Report

  • Get access to the downloadable Monthly Tax and ITC Summary Report whenever you look at trends across many months.

  • Verify the cash and credit ledger entries for the tax obligation, input tax credit, and tax payment breakdown.

  • Keep track of your input tax credit and your tax obligations for outward supplies and reverse charges on a monthly, quarterly, or yearly basis.

  • It is possible to compare the information at the PAN and GSTIN levels.

  • Download the data in Excel format for simple storage and sharing of data.

  • When completing the yearly GST returns, use the data for verification purposes.