Reconcile GSTR-2B against the Purchase Register into an ITC Report

Skill: Convert a GSTR-2B JSON and purchase register into an ITC reconciliation report

Region: India Category: GST — Input Tax Credit reconciliation (GSTR-2B vs books) Does: Takes the downloaded GSTR-2B JSON and the buyer's purchase register and produces an invoice-level ITC reconciliation report (JSON) — match status, mismatches, ineligible ITC under section 17(5), a vendor follow-up list, and the eligible ITC figures for GSTR-3B table 4. Standard: GSTN GSTR-2B (auto-drafted ITC statement) reconciled to books; output feeds GSTR-3B Table 4.

GSTR-2B is a static monthly statement (generated on the 14th). ITC is generally available only for invoices appearing in GSTR-2B (Rule 36(4) / section 16(2)(aa)). The AI matches and classifies; the taxpayer confirms eligibility and follows up with vendors before claiming. Verify cut-off dates and the current Rule 16(4) time limit.

When this applies

• A registered buyer reconciles purchases booked in its accounts against the ITC reflected in GSTR-2B for a tax period, before filing GSTR-3B.
• Identifies invoices in books-not-in-2B (defer the claim), in-2B-not-in-books (book or query), and value/tax mismatches.
• Not for generating GSTR-1 (supplier outward) or the GSTR-9 annual return (see gst/build-gstr9-json.md).

Reconciliation procedure

1. Read both sources. Parse the GSTR-2B JSON (sections b2b, cdnr, etc.) and the purchase register (CSV/JSON: supplier GSTIN, invoice no, date, taxable value, IGST/CGST/SGST/cess, eligibility).
2. Build match keys. Key = supplier GSTIN + invoice number (normalized) + invoice date. Tolerate minor invoice-number formatting differences but flag them.
3. Classify each record. matched, mismatch_value, in_2b_not_in_books, in_books_not_in_2b. For matched, compare taxable value and each tax head within a tolerance (e.g. ₹1).
4. Apply eligibility. Flag ineligible ITC under section 17(5) (blocked credits) and any other non-creditable items; split eligible vs ineligible.
5. Aggregate to GSTR-3B Table 4 figures (4A(5) all other ITC, 4B reversals, 4D ineligible).
6. Emit the JSON report and a vendor follow-up list; validate with the checklist.

Source → reconciliation field map

Document structure

itc_reconciliation
├── gstin, period
├── lines[]              (per-invoice: keys, 2B vs books amounts, status, eligibility)
├── summary
│   ├── matched_count / mismatch_count / only_2b / only_books
│   ├── itc_eligible (igst/cgst/sgst/cess)
│   └── itc_ineligible
├── gstr3b_table4        (4A5, 4B2, 4D1, 4D2)
└── vendor_followup[]    (gstin, issue, invoices)

Code tables

Match status

Eligibility

GSTR-3B Table 4 targets

Calculation rules

• Tolerance: |taxable_2b − taxable_books| ≤ ₹1 and each tax head ≤ ₹1 ⇒ matched; otherwise mismatch_value.
• Eligible ITC = Σ tax heads of matched/mismatch lines that are eligible and present in 2B.
• Ineligible ITC (17(5)) = Σ tax heads flagged blocked_17_5 (report in 4D1; if availed then reversed, also reflect in 4B).
• GSTR-3B 4A5 = eligible IGST/CGST/SGST/cess available from 2B for the period.
• Recompute every total from the line set; flag mismatches with the books.

Worked example (end-to-end)

Input — GSTR-2B (excerpt) + purchase register

GSTR-2B b2b: 27ABCDE1234F1Z5 | INV-101 | 2026-05-10 | taxable 100000 | IGST 18000
Purchase register:
  27ABCDE1234F1Z5 | INV-101 | 2026-05-10 | taxable 100000 | IGST 18000 | eligible
  27ZZZZZ9999Z1Z9 | INV-77  | 2026-05-12 | taxable 50000  | IGST 9000  | eligible   (not in 2B)
  27MNOPQ4321K1Z2 | INV-55  | 2026-05-08 | taxable 20000  | CGST 1800 SGST 1800 | blocked_17_5 (staff catering)

After matching + classification (intermediate)

INV-101 → matched, eligible (IGST 18000 available)
INV-77  → in_books_not_in_2b (defer 9000) → vendor follow-up
INV-55  → matched, blocked_17_5 (CGST 1800 + SGST 1800 ineligible)
eligible ITC: IGST 18000 ; ineligible 17(5): 3600

Output — ITC reconciliation report

{
  "gstin": "27AAAAA0000A1Z5",
  "period": "052026",
  "lines": [
    { "gstin": "27ABCDE1234F1Z5", "invoice_no": "INV-101", "invoice_date": "2026-05-10",
      "taxable_2b": 100000, "taxable_books": 100000,
      "tax_2b": { "igst": 18000, "cgst": 0, "sgst": 0, "cess": 0 },
      "tax_books": { "igst": 18000, "cgst": 0, "sgst": 0, "cess": 0 },
      "status": "matched", "eligibility": "eligible" },
    { "gstin": "27ZZZZZ9999Z1Z9", "invoice_no": "INV-77", "invoice_date": "2026-05-12",
      "taxable_2b": 0, "taxable_books": 50000,
      "tax_2b": { "igst": 0, "cgst": 0, "sgst": 0, "cess": 0 },
      "tax_books": { "igst": 9000, "cgst": 0, "sgst": 0, "cess": 0 },
      "status": "in_books_not_in_2b", "eligibility": "eligible" },
    { "gstin": "27MNOPQ4321K1Z2", "invoice_no": "INV-55", "invoice_date": "2026-05-08",
      "taxable_2b": 20000, "taxable_books": 20000,
      "tax_2b": { "igst": 0, "cgst": 1800, "sgst": 1800, "cess": 0 },
      "tax_books": { "igst": 0, "cgst": 1800, "sgst": 1800, "cess": 0 },
      "status": "matched", "eligibility": "blocked_17_5" }
  ],
  "summary": {
    "matched_count": 2, "mismatch_count": 0, "only_2b": 0, "only_books": 1,
    "itc_eligible": { "igst": 18000, "cgst": 0, "sgst": 0, "cess": 0 },
    "itc_ineligible": { "igst": 0, "cgst": 1800, "sgst": 1800, "cess": 0 }
  },
  "gstr3b_table4": {
    "4A5": { "igst": 18000, "cgst": 0, "sgst": 0, "cess": 0 },
    "4D1": { "igst": 0, "cgst": 1800, "sgst": 1800, "cess": 0 }
  },
  "vendor_followup": [
    { "gstin": "27ZZZZZ9999Z1Z9", "issue": "in_books_not_in_2b", "invoices": ["INV-77"] }
  ]
}

Normalisations shown: keys built as GSTIN+invoice+date; INV-77 deferred (not in 2B) and pushed to vendor follow-up; INV-55 catering flagged blocked_17_5 → 4D1; eligible 4A5 IGST recomputed as 18000.

Validation checklist

• Both sources parsed; match key = GSTIN + invoice no + date (formatting differences flagged)
• Every record classified (matched / mismatch_value / in_2b_not_in_books / in_books_not_in_2b)
• Section 17(5) blocked credits flagged and excluded from eligible ITC
• Eligible ITC counts only invoices present in GSTR-2B (Rule 36(4) / 16(2)(aa))
• GSTR-3B Table 4 figures (4A5, 4B, 4D1) reconcile to the summary
• Vendor follow-up list covers all in-books-not-in-2B and mismatches
• Totals recomputed from lines; ITC time-limit (Rule 16(4)) considered before claiming

Last updated: 2026-06-13 — verify current ITC eligibility rules (36(4), 16(2)(aa), 16(4)), section 17(5) list, and GSTR-3B Table 4 structure before use.