INDIRECT TAX RECONCILIATION

In today’s GST-driven economy, even a small mismatch can lead to big compliance troubles. Indirect Tax Reconciliation is the process of matching and verifying tax data reported in an entity’s books of accounts with the details filed in GST returns (like GSTR-1, GSTR-3B, and GSTR-2A/2B).

It’s the process of matching your sales, purchases, and tax credits with data filed on the GST portal — helping you stay accurate, compliant, and penalty-free.
By reconciling regularly, businesses not only protect their Input Tax Credit (ITC) but also build a stronger foundation for smooth audits, transparent reporting, and financial confidence.

Why Indirect Tax Reconciliation Is Important?

Ensures accurate GST reporting and prevents mismatches.
Helps in claiming correct Input Tax Credit (ITC).
Avoids interest, penalties, and notices from tax authorities.
Builds trust and transparency in financial statements.
Supports smooth GST audits and annual return filings.

FAQs

Ideally, it should be done monthly or quarterly, before filing GST returns.

Sales, purchase, input tax credit, tax liability, and annual reconciliation.

While not explicitly mandatory, it’s essential for compliance and smooth GST audits.

Ensures accurate tax reporting, protects ITC, avoids notices, and strengthens compliance credibility.

You may face loss of ITC, penalties, notices, or discrepancies during GST audits.