Dear sir,
kindly suggest that where we have report ineligible ITC on exempted supplies in gstr-3b and gstr9 return.
pl advice
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ITC reversal on exempted supplies
Replies (5)
Quick Summary
Your question appears to be incorrect.
Exempt supplies refer to transactions without a tax element, meaning no Input Tax Credit (ITC) is available.
so there is no question of ineligible ITC on exempted supplies.
Exempt supplies refer to transactions without a tax element, meaning no Input Tax Credit (ITC) is available.
so there is no question of ineligible ITC on exempted supplies.
We have manufacturing exempted as well as taxable goods and we have not take ITC on inputs used in manufacturing exclusively exempted product so that ineligible ITC need to shown in GST return.
pl advice where to report in GST return 3b and annual return.
Thanks in advance
pl advice where to report in GST return 3b and annual return.
Thanks in advance
ITC has to be shown in Table 4A5 and has to be reversed through Table 4B1 of GSTR 3B. Go through rule 42 and descriptttion of Table 4B1 of GSTR 3B.
And in Table 7C of GSTR 9 has to be declared.
Thank you sir
Where to report it:
• ITC used exclusively for exempt supplies isn't eligible (Sec 17(2)). Report it in GSTR-3B Table 4(D)(1) (ineligible ITC under Sec 16(4) & ITC restricted due to PoS rules, from 2022) or, more commonly, 4(B)(1) (reversal as per Rules 38, 42, 43 and Sec 17(5)) if you initially claimed it in 4A.
• Common ITC used for both: Rule 42/43 monthly reversal in 4(B)(1), and the annual true-up in September of the next year.
• GSTR-9: Table 7 (ITC reversed and ineligible): Rule 42 reversal goes in 7C, Rule 43 in 7D, Sec 17(5) in 7E, others in 7H. ITC never claimed (ineligible, not taken) isn't reported as reversal.
• If ITC was never availed on exempt-only purchases, nothing is reversed. Keep it out of 4A.
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