GST Reconciliation Using Python

A Practical Guide for Chartered Accountants & Tax Professionals

In today’s GST environment, manual reconciliation using Excel is no longer scalable.
With frequent notices like ASMT-10, DRC-01C, ITC mismatch communications, professionals need accurate, repeatable, and audit-ready reconciliation.

This is where Python automation becomes a game-changer for GST compliance.

What is GST Reconciliation?

GST reconciliation means matching data reported in GST returns with the books of accounts to identify:

• Missing invoices
• Excess or ineligible ITC
• Short or excess tax payments
• Reporting mismatches across returns

Common Reconciliations Performed

Why Use Python for GST Reconciliation?

Traditional Excel-based reconciliation has limitations:

• Manual errors
• Time-consuming
• Difficult to repeat monthly
• Poor audit trail

Python Advantages

• Fully automated
• Handles large data (lakhs of invoices)
• Consistent logic every month
• Reusable scripts for multiple clients
• Easy integration with Power BI & AI tools

GST Reconciliation Workflow Using Python

Step 1: Data Extraction

Export the following files:

• Purchase Register from Tally / ERP
• GSTR-2B (Excel from GST Portal)
• GSTR-1 & GSTR-3B (Excel)

Step 2: Standardise the Data

Before reconciliation, standardisation is critical:

• Clean GSTIN
• Trim invoice numbers
• Convert invoice dates
• Align column names

Step 3: Books vs GSTR-2B Reconciliation (ITC)

Below is a simple Python example using Pandas:

```python import pandas as pd

books = pd.read_excel("books_purchase.xlsx") gstr2b = pd.read_excel("gstr2b.xlsx")

books['Invoice No'] = books['Invoice No'].astype(str).str.strip() gstr2b['Invoice No'] = gstr2b['Invoice No'].astype(str).str.strip()

books['key'] = books['GSTIN'] + "|" + books['Invoice No'] gstr2b['key'] = gstr2b['GSTIN'] + "|" + gstr2b['Invoice No']

reco = books.merge( gstr2b, on='key', how='left', suffixes=('_books', '_2b'), indicator=True )

reco['ITC Status'] = reco['_merge'].map({ 'both': 'Matched', 'left_only': 'Not appearing in GSTR-2B' })

reco.to_excel("ITC_Reconciliation_Report.xlsx", index=False)