Gst liability

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 August 2017 IGST ON PURCHASE 100000/-
CGST ON PURCHASE 2000/-
SGST ON PURCHASE 2000/-

IGST ON SALES 10000/-
CGST ON PURCHASE 42000/-
SGST ON PURCHASE 42000/-

WHAT IS MY TAX LIABILITY ?

PLS PLS REPLY ON URGENT

Querist : Anonymous

Querist : Anonymous (Querist)

18 August 2017 IGST ON PURCHASE 100000/- CGST ON PURCHASE 2000/- SGST ON PURCHASE 2000/- IGST ON SALES 10000/- CGST ON PURCHASE 42000/- SGST ON PURCHASE 42000/- WHAT IS MY TAX LIABILITY ? PLS PLS REPLY ON URGENt

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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26 July 2024 To calculate your GST liability, you need to follow these steps:

1. **Determine the Input Tax Credit (ITC):**
- ITC on Purchases: This includes all the GST paid on purchases which you can claim as a credit.

2. **Determine the Output Tax Liability:**
- Output GST: This is the GST you have collected on sales.

3. **Calculate the Net Tax Liability:**
- Subtract the ITC from the Output GST to determine the amount payable to the government.

Here's a detailed breakdown based on the information provided:

### **1. Input Tax Credit (ITC) Calculation:**

**Input GST on Purchases:**
- **IGST on Purchases:** ₹1L
- **CGST on Purchases:** ₹2K
- **SGST on Purchases:** ₹2K

Total ITC on Purchases = ₹1L (IGST) + ₹2K (CGST) + ₹2K (SGST) = ₹1.04L

### **2. Output Tax Liability Calculation:**

**Output GST on Sales:**
- **IGST on Sales:** ₹10K
- **CGST on Sales:** ₹42K
- **SGST on Sales:** ₹42K

Total Output GST = ₹10K (IGST) + ₹42K (CGST) + ₹42K (SGST) = ₹94K

### **3. Net Tax Liability Calculation:**

- **IGST Liability:** You can set off IGST on sales against IGST on purchases. The net IGST liability is:
- IGST on Sales: ₹10K
- IGST on Purchases (ITC): ₹1L
- **Net IGST:** ₹10K (Output IGST) - ₹1L (ITC on Purchases) = **Negative ₹90K**

Since you have excess ITC of ₹90K on IGST, it can be carried forward to the next period or refunded as applicable.

- **CGST Liability:** You can set off CGST on sales against CGST on purchases.
- CGST on Sales: ₹42K
- CGST on Purchases (ITC): ₹2K
- **Net CGST:** ₹42K (Output CGST) - ₹2K (ITC on Purchases) = **₹40K (Payable)**

- **SGST Liability:** You can set off SGST on sales against SGST on purchases.
- SGST on Sales: ₹42K
- SGST on Purchases (ITC): ₹2K
- **Net SGST:** ₹42K (Output SGST) - ₹2K (ITC on Purchases) = **₹40K (Payable)**

### **Summary of Tax Liability:**

- **IGST:** **Negative ₹90K** (excess ITC, can be carried forward or claimed as a refund)
- **CGST:** **₹40K Payable**
- **SGST:** **₹40K Payable**

**Total Tax Payable:** ₹40K (CGST) + ₹40K (SGST) = **₹80K**

You do not have any liability under IGST for this period; instead, you have an excess credit of ₹90,000. You need to pay ₹80K in CGST and SGST.

Make sure to report and adjust these figures in your GST returns (GSTR-3B and GSTR-1) as applicable. For detailed advice or specific scenarios, consulting with a GST professional is advisable.

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