In this article you will get to know about all the 4 Types of ITC Forms available at GST Portal in brief and will help to get a clear understanding about them by reading CRUX.
There are 4 types of ITC Forms, which are as follows:-
- ITC 01 - ITC for new GST Registration
- ITC 02 - Transfer of ITC in case of sale/merger etc.
- ITC 03 - Reversal of ITC
- ITC 04 - ITC on goods sent to Job Worker
1) ITC 01 - ITC for new GST Registration
The declaration form in ITC - 01 is required to be filed in the following cases:
- When an application for GST registration is made within 30 days of becoming liable to pay GST. [Section 18(1)(a)]
- When any person opts for voluntary registration. [Section 18(1)(b)]
- When any person opts out of composition scheme but continues to be registered as a regular taxpayer. [Section 18(1)(c)]
- When an exempt supply of goods/services becomes taxable supply. [Section 18(1)(d)]
(Input tax credit is allowed in respect of inputs held in stock, inputs contained in semi-finished/finished goods, capital goods on the cut-off date.)
Points to remember while filing ITC 01:
- Know what input tax credits can be claimed. For example, the ITC in respect of services cannot be claimed in Form ITC 01. ITC in respect of capital goods can only be claimed in case composition dealer opts out of composition scheme and where exempted supply becomes taxable supply.
- Invoice wise Details of ITC on purchases as on the cut-off date should be available.
- Form ITC 01 should be filed within 30 days of the date of registration/migration to a regular scheme.
- Invoices up to one year old can be claimed in case of inputs and up to five years in case of capital goods.
- If the ITC claim is more than INR 2 lakhs, Chartered Accountant certificate or Cost Accountant certificate must be uploaded.
2) ITC 02 - Transfer of ITC in case of sale/merger etc.
A registered taxpayer can apply for transfer the matched Input Tax Credit available in the Electronic Credit Ledger to another business entity in case of transfer of business by way of sale of business / merger / demerger by filing of ITC declaration in FORM GST ITC-02.
However, there are certain Pre-requisites for filing this form. These are:
- In case any registered entity undergo sale, merger, de-merger, amalgamation, lease or transfer, the acquired entity must file ITC declaration for transfer of ITC in the FORM GST ITC-02.
- The acquired / transferor entity must have matched Input Tax Credit available in the Electronic Credit Ledger, as on effective date of merger/ acquisition/ amalgamation / lease/ transfer.
- The acquiring entity (transferee) and acquired entity (transferor), both should be registered under the GST regime.
- The acquired entity (transferor) must have validly filed all the returns for the past periods.
- All transactions categorized as pending for action of merging entity should be either accepted / rejected / modified, and any liabilities arising out of the returns filed by the transferor must be paid.
- The transfer of business should be with specific provision of transfer of liabilities which will be the stayed demands of tax, or in respect of litigation /recovery cases. It should be accompanied by the certificate issued by Chartered Accountant or Cost Accountant.
The process of transferring matched unutilized ITC by filing the FORM GST ITC-02 is broadly divided into two steps:
1. The acquired entity (transferor) files declaration in FORM GST ITC-02 in the GST portal, specifying the available matched ITC in each major head.
2. The acquiring entity (transferee) accepts / rejects the same in GST portal.
3. ITC 03 - Reversal of ITC
It should be filed under two situations:
- If one is opting for Composition Scheme
- If any taxable supply becomes exempt
Pre-requisites to file ITC 03:
- Input tax credit should have been availed by the taxpayer earlier in order to reverse it using ITC 03
- The taxpayer should intimate the department regarding opting for composition scheme in CMP-02 at the beginning of the year.
- The taxpayer must possess a digital signature certificate (DSC) or an electronic verification code (EVC)
- In case invoice details are not available, a certificate from a Chartered Accountant is required certifying the value of goods
If a taxpayer is filing ITC 03 on account of opting for composition scheme, he should file this form once in a financial year. This is because once he opts for composition scheme in the beginning of the financial year, it cannot be changed till the next financial year.
This form has to be filed within 60 days from the commencement of the financial year. If CMP 02 has been filed before March 31 2018, then ITC 03 has to be filed within 180 days of commencement of the scheme .If a taxpayer is filing ITC 03 on account of products or services becoming exempt, he should file the form as and when the notifications are issued.
4. ITC 04 - ITC on goods sent to Job Worker
FORM GST ITC-04 must be submitted by the principal every quarter. He must include the details of challans in respect of the following:
- Goods dispatched to a job worker or
- Received from a job worker or
- Sent from one job worker to another
ITC-04 is a quarterly form. It must be furnished on or before 25th day of the month succeeding the quarter. For example, for Oct-Dec quarter, the due date is 25th Jan.
The principal manufacturer will be allowed to take credit of tax paid on purchase of goods send on job work:
- From principal’s place of business
- Directly from the place of supply of the supplier of such goods
The goods send must be received back by the principal manufacture within the following period:
- Capital Goods- 3 years
- Input Goods- 1 year
In case goods are not received within the period mentioned above, such goods will be treated as supply from the effective date and tax will be payable.