Input tax credit

This query is : Resolved

MAKARAND DAMLE (Querist)
Follow

26 April 2019 Supplier has given bill dtd Apr 19 and will be uploading his invoice in Apr 19
However this purchase is against sales booked in March 19
In such a case can we book supplier invoice without GST in March 19 and only GST component in Apr 19 ?

MAKARAND DAMLE

MAKARAND DAMLE (Querist)
Follow

07 May 2019 Can any expert reply please

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
Follow

09 July 2024 In GST (Goods and Services Tax) regulations, the time of supply determines when a transaction is considered to have occurred for taxation purposes. Here’s how you should handle the scenario described:

1. **Time of Supply (Invoice Issuance):**
- For the purchase made against sales booked in March 2019, the time of supply for GST purposes is determined based on the date of the invoice issued by the supplier.
- If the supplier issues the invoice in April 2019 for the purchase related to sales booked in March 2019, the time of supply is considered to be April 2019.

2. **Booking in Accounts:**
- From an accounting perspective, you typically record transactions based on the invoice issued by the supplier. Therefore, if the supplier issues the invoice in April 2019, you should record this invoice and its GST component in your accounts for April 2019.
- You cannot book the entire invoice (including GST) in March 2019 if the invoice itself is issued in April 2019.

3. **Input Tax Credit (ITC) Consideration:**
- To claim Input Tax Credit (ITC) on the GST component of the invoice, you must have the invoice in your possession and it must be valid under GST rules. This includes ensuring that the invoice date aligns with the date on which you want to claim the ITC.
- Since the invoice is issued in April 2019, the ITC related to GST can be claimed in April 2019 after the invoice is uploaded by the supplier and you have possession of the invoice.

### Conclusion:
You should book the supplier invoice without GST in March 2019 only if the invoice is actually issued in March 2019. Since the supplier plans to issue the invoice in April 2019, you should book the invoice (including GST component) in your accounts in April 2019 when you receive the invoice from the supplier.

Ensure that you follow both accounting principles and GST regulations to correctly reflect the transaction in your records and to comply with GST laws regarding the timing of supply and claiming Input Tax Credit. If in doubt, it’s advisable to consult with a tax professional or accountant familiar with GST regulations to ensure compliance.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now