Treatment of gst credit memo / credit note
Querist : Anonymous
please explain in brief , the treatment of credit note / credit memo treatment in GST 3b and GSTR-1.
Querist : Anonymous
In GSTR 3B you will reduce Rs. 100 from the outward supplies and reduce Rs. 18 from the tax liability
In GSTR1 the credit note will be shown separately
Querist : Anonymous
---
### 1. **Credit Note in GST**
* A **credit note** is issued by the supplier to reduce the value of a supply previously invoiced, due to returns, discounts, or errors.
---
### 2. **Treatment in GSTR-1**
* Credit notes are **reported separately** in GSTR-1.
* They appear in **Table 9B** of GSTR-1 (Credit/Debit Notes issued during the month).
* You need to report:
* Taxable value reduced (e.g., Rs. 100)
* GST amount reduced (e.g., Rs. 18)
---
### 3. **Treatment in GSTR-3B**
* In **GSTR-3B**, you adjust the **outward supplies** and the **tax liability** for the month by reducing the value of the credit note.
* Example:
* Original supply: Taxable value Rs. 100 + GST Rs. 18
* Credit note: Rs. 100 (taxable value) + Rs. 18 (GST)
* So, in GSTR-3B:
* **Reduce Rs. 100** from **outward taxable supplies** (in Table 3.1(a))
* **Reduce Rs. 18** from **output tax liability** (in Table 3.1(b) for CGST and SGST or 3.1(c) for IGST as applicable)
---
### 4. **Effect on ITC**
* Credit notes do **not impact Input Tax Credit (ITC)** directly.
* ITC is claimed on **purchases** and **input services**.
* Credit notes affect only the **output liability** (supplier’s side).
* However, if you are the recipient and receive a credit note, you will adjust your ITC accordingly in your purchase records.
---
### **Summary Table:**
| Aspect | Treatment |
| ------------- | -------------------------------------------- |
| GSTR-1 | Report credit note separately in Table 9B |
| GSTR-3B | Reduce outward taxable supplies & output tax |
| Effect on ITC | No direct effect on ITC for supplier |
---
If you want, I can help you with example entries or formats for your GST returns. Would you like that?
Click here to login now
Similar Resolved Queries
- GSTR-1A How to update Invoice
- Excess salary payment.
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- TDS on Purchase of Immovable Property by NRI from NRI
- Capital gain from sale of house property
- Stamp Paper for partnership firm change new income tax 2025
- SFT Cash Deposit in Current Account
- FORM 26A APPLICABILITY
- When TDS on GST applied
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
- Claiming TDS deducted by builder on Hardship compensation and Corpus
- Address Change to another state of a Registered Trust with 12AB approval
- Updated return in budget 2026
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
