Payment under self ass. scheme

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A business using the new quarterly GST payment scheme (QRMP) inquired about deducting their opening Input Tax Credit (ITC) when paying GST under self-assessment. They wanted to know if they could carry forward excess ITC to avoid paying GST for January. The advice given is to proceed, but with a crucial clarification: for the first two months of the quarter, the payment is based on 35% of the net cash liability from the preceding month or quarter, irrespective of the ITC balance.

Gopalakrishnan. S

Gopalakrishnan. S (Querist)

17 February 2021 Sir,

We have opted to file 3B on quarterly basis under the new QRMP scheme. While paying the GST under Self Assessment mode, shall we deduct the opening ITC , which has been brought forward from Dec 20.
If we do so, we have excess of ITC to be carried down to Feb 21 and hence, need not pay any GST for Jan 21.
Shall we go ahead with this ? Is this the correct way or may attract levy of interest, etc ( Since there is no way to tell GST that, we have consolidated ITC, which is more than the output tax for the month )

Pls. advice.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

17 February 2021 Yes, go ahead with this, this is the correct way.

Lekhraj sood

Lekhraj sood (Expert)

18 February 2021 You have to pay 35% of your net cash liability discharged in Dec 20 month or quarter. There is no consideration of your ITC balance under QRMP scheme for 1st and 2nd month of the quarter.

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