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Is it okay to pay SGST even if IGST ITC is available

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Manoj Agrawal

23 Points Posted on 15 September 2023

Hello all,

Is it okay to pay SGST amount in Cash even though I have IGST ITC credit available and utilize the IGST ITC credit for future months ITC adjustments?

So say for Aug 23
ITC available IGST - 100, CGST-10 and SGST-10
Liability - IGST 40, CGST 50 and SGST 50
So overall liability after adjusting ITC is IGST - NIL, CGST-NIL, SGST-20

However, I would like to do the following:
IGST-NIL, CGST-NIL and SGST-40 and keep balance of IGST of Rs.20 as pending in credit ledger for utilizing in next month GST return.

Is this okay?

Replies (5)

Quick Summary

This discussion explores whether it's permissible to pay SGST in cash even when IGST Input Tax Credit (ITC) is available. While some suggest it's possible to defer IGST ITC usage, others point to specific GST regulations that mandate exhausting IGST ITC first before utilising CGST or SGST ITC. The consensus leans towards the latter, advising adherence to the prescribed order of ITC utilisation to avoid compliance errors.

RAJA P M

"Do the Right Thing...!!!"

77833 Points Posted on 15 September 2023

Yes, You can.

V SUBRAMANIAM

Tax consultant

375 Points Posted on 16 September 2023

As per your statement igst nil sgst paid 20 rs more and will be available only in sgst.
u cannot carry over igst credit except your overall liability is less than the igst credit.