Accountant
281 Points
Joined February 2008
Originally posted by : Pankaj Rawat |
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Correct ,.... this will not going to implemented for long. |
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I Agree. Also, the rule fails to take into account suppliers who are on Quarterly filing of GSTR-1. Which means, as per current rule, you may have to wait for 1 to 3 months to be able to add their invoices to Availabie ITC calculation (that too if they file their quarterly return by the due date).
There are many businesses wherein most of the purchase is from small traders under quarterly filing.
The two big drawbacks with this new rule are :-
1) It affects your cash flow because you may end up paying cash instead of utilising the ITC amount restricted by the 20% rule. Which is till the time these invoices are filed by suppliers. As a result, there might always be some portion of your cash blocked against unutilised ITC.
2) It complicates the process of tracking ITC and it's annual comparison between Books and GST returns, which further adds to the complication in filing GST Annual Return & Reconciliation.