NEW PROCEDURE TO CLAIM INPUT TAX CREDIT WITH EFFECT FROM 09.10.2019 (Vide Notification no. 49/2019 dated 09.10.2019)
♦ Input Tax Claim shall not exceed GSTR 2A Total ITC + 20% of GSTR 2A ITC Amount (This amount should not exceed Eligible credit for the month)
For e.g. : If eligible ITC for the month of October 2019 is Rs 10 Lakhs, and ITC available in GSTR 2A is Rs 8 Lakhs, eligible ITC is: 8 Lakhs + 20% of 8 Lakhs = 9.6 Lakhs) .
In this case , if the dealer have 8.3 Lakhs or more in GSTR2A , dealer can claim full ITC ( Rs 10 Lakhs) in GSTR3B of October 2019. (This is because, the gap between the available credit in GSTR2A (Rs. 8.3 Lakhs) and The ITC Claim (Rs. 10.00 Lakhs) for the month of October 2019 is below or equal to 20% of GSTR2A amount. If the gap is below or equal to 20%, dealer can claim 100% ITC in the month of October 2019)
If the dealer have credit in 2A IS below Rs 8.3 Lakhs , the ITC eligibility is restricted to 20 % of eligible credit available in GSTR 2A. Please find the below table (THREE CASES GIVEN AS SAMPLE) for calculating eligible ITC for October 2019:
|Case||Available Balance in GSTR 2A for October 2019||20% of Eligible Credit (A*20%)||Eligible ITC to be taken in GSTR 3B (A+B)|
*8,50,000 + 1,70,000= 10,20,000 , Eligible ITC limited to Rs 10,00,000
♦ How the the balance ITC to be claimed
The balance ITC be claimed by the taxpayer in any of the succeeding months (November 2019 onwards) provided details of requisite invoices are uploaded by the suppliers.
Procedure and Calculations for availing the balance ITC of October 2019 is given below with reference to CASE 1 given above:
|Return Month||Available in GSTR2A against October (assumptions)||Already availed ITC Or Eligible ITC in each month from October||Cumulative ITC balance of October month||Calculation for arriving Column F|
|March 2020||1,30,000||55,000*||10,00,000||Already availed 9.45 Lakhs .Balance can avail only 0.55 Lakhs|
SUGGESTION: TO AVOID THE ABOVE COMPLICATED CALCULATIONS, YOU CAN OPT FOR A BETTER WAY IN RETURN FILING. CLAIM ITC AS PER RESPECTIVE GSTR 2A ONLY. IF THE DEALER HAS SUFFICIENT ACCUMULATED ITC IN THEIR CREDIT LEDGER, OPT FOR THIS OPTION. SO, YOU WILL BE FREE FROM THE ABOVE SAID CALCULATIONS AND RULES.