Like we have a credit balance of ITC of almost like 1 lakh rupees and out gst has been cancelled during mar 23 , now in plight of Amnesty scheme , We are in thought of filing final return yet, do we need to reverse the ITC is the question
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ITC reversal must be done during cancellation ?
Replies (1)
Hey! About ITC reversal when your GST registration is cancelled — here’s the quick scoop:
ITC Reversal on Cancellation:
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When GST registration is cancelled, any unutilized ITC balance in your electronic credit ledger must be reversed.
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This is because you cannot carry forward or use ITC after cancellation.
In your case (ITC ~ ₹1 lakh, cancellation in Mar 2023):
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You must reverse the ITC balance while filing your final GST return (GSTR-10).
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The ITC reversal will be shown as an outward liability (added to your tax liability).
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If you don’t reverse, the department can raise a demand later.
Amnesty scheme impact:
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Amnesty scheme generally helps with late fees or penalties but does not waive off ITC reversal compliance.
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So even if filing under amnesty, you need to reverse ITC balance properly.
Summary:
| Situation | Action |
|---|---|
| GST cancelled | Reverse unutilized ITC in final return |
| Amnesty scheme | Does NOT exempt ITC reversal |
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