INPUT CREDIT UNDER RCM QUERY

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This discussion clarifies when a recipient can claim Input Tax Credit (ITC) for services under the Reverse Charge Mechanism (RCM). Experts advise that RCM ITC can be claimed in the month the RCM liability is paid, irrespective of when the payment is made to the supplier. It's recommended to pay the RCM liability by the due date for the relevant period and then claim the ITC against output liability.

Rashmi Ranjan Das

Rashmi Ranjan Das (Querist)
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18 May 2022 Dear Experts
If a registered recipient taken advocate service Rs. 100000.00 of 15th April 2022 and booked the RCM liability Rs.18000/- in his books on Apr 22. But the payment was made to the supplier on 14th May 2022. So my question is,
1. Recipient can get the ITC under RCM in April or in May?
2. If not in Apr then the recipient should pay the RCM Liability Rs.18000/- through the cash ledger in April then the RCM input will get a refund or will adjust with the RCM liability ahead once payment is done?
Request you to all experts to have a look at this issue and guide me.
Thank you

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 May 2022 1 RCM can be taken in the month of payment of RCM irrespective of payment to the supplier.
2 Pay RCM and claim ITC on it against output liability.