Vat input

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 September 2016 whether excess VAT input 4% or 5% ( after adjusting VAT output of 4% & 5%) can be adjusted against 12.5% (after adjusting VAT input 12.5%) VAT output.

Expert : Anonymous

Expert : Anonymous (Expert)

12 September 2016 Dear User, For which state u r taking about.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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02 August 2025 Great question about VAT input credit adjustment across different VAT rates!

### To clarify:

* You have **input VAT at 4% or 5% rates** and you’ve adjusted it against output VAT at those same rates.
* Now, you want to know if **any excess input VAT at 4% or 5% can be adjusted against output VAT at 12.5% (after adjusting input VAT at 12.5%)**.

---

### General principle under VAT laws:

* **Input VAT credit can be adjusted only against output VAT of the *same rate slab*.**
* Different VAT rates correspond to different categories of goods/services, and credit cannot be cross-adjusted between different rates.
* So, **excess input VAT at 4% or 5% cannot be used to offset output VAT at 12.5%.**

---

### What you can do:

* Adjust input VAT only against output VAT of the **same rate**.
* If excess input credit remains unused at a lower rate, it can generally be carried forward or claimed as refund (subject to state VAT laws and procedures).
* Excess input credit from one rate slab is not transferable to offset output tax liabilities at another rate slab.

---

### Summary:

| Input VAT Rate | Can Adjust Against Output VAT Rate? |
| -------------- | ----------------------------------- |
| 4% or 5% | Only against output VAT at 4% or 5% |
| 12.5% | Only against output VAT at 12.5% |

---

If you want, I can also help with the exact rules for your state or how to file returns with these multiple rates.

Would that be helpful?

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