SOP on Input Tax Credit under GST in case of 20% cap

Section 43A Rule 36(4) of the CGST Act, 2017 and CGST Rules, 2017 – Restricting the Input Tax Credit (ITC) limit to 20% of the eligible ITC which is as per GSTR-2A.

GST Payable now shall be paid. ITC Deferred a/c balance left out now shall be recoverable in next months as when appear in Fom-2A.

Let’s Take an Example for better understanding

Make Entry in Books after the Reconciling of Form -2A [ Amount in Rs.]