Dear Sir, while payment to vendors we withhold the specific portion of amount as Retention money as per contract. is in this case also we will have to reverse the tax portion if payment not made within 180 days?
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Quick Summary
This discussion clarifies the treatment of Goods and Services Tax (GST) on retention money withheld from vendor payments. It addresses whether the tax portion needs to be reversed if payment isn't made within 180 days, as required for other overdue invoices. The consensus is that GST on retention money is indeed reversible if the payment exceeds 180 days, and the credit can be utilised upon final payment.