How does one show itc on capital goods in gstr 3b ?

Hello fellow harrased professionals .

My query is related to ITC on capital goods. 

We know that as per GST act , we may only claim 5% credit per quarter ..ie. 20% per year spread out over 5 years.

Now how should our working be shown in 3b ?

1 - Should we add proportionate GST credit every month in 'all other ITC' in 3b...

Or

2 - Should we take all of the credit in first month but not utilize the balance against GST liability.  Ie..keep credit in ledger but don't use it to offset liability.

Or

3 - Should we take all of the credit in 'all other ITC' in 3b and then reverse the ineligible amount....Then take proportionate amount every month by reversing the earlier ineligible amount.

 

I am using one of the options from above but I wanted the advise from experts and elites of this profession.

Replies (2)
Are you providing Taxable as well as exempted supplies?

If you are providing only Taxable supplies:
No need to reverse any ITC avail on Capital Goods

If You are Providing both Taxable & Exemptes supply :
Yes you have to reverse ITC attributable to exempted supply on monthly basis
formula for the same is...

. Calculate monthly credit - ITC on Capital Goods ÷ 60, say C

2. Calculate ITC attributable to exempt supply 

C x Exempt Supply ÷ Total Supply for the month

3. Reverse the same for every month

4. Pay interest as well 😂

Check rule 43(c)

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