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Reversal of ITC on unpaid Invoices

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Sunil

Business

34 Points Posted on 17 February 2021

Hello Experts

On very rare occasions, our GST invoice is not paid by the client for many days. By that time, we have already paid GST in advance & filed all returns (monthly GSTR 3B & qtrly GSTR 1). It is also possible that the client has availed ITC. However, the client doesn't appear to be in a mood to clear payments despite all our reminders & efforts.

Is there a provision in GST to reverse such ITC & get a refund from GST.

Thanks in advance for your valuable inputs

Regards

SUNIL

Replies (6)

Quick Summary

This discussion addresses the challenge of clients not paying for GST-registered invoices, where GST has already been paid and returns filed. The original poster inquired about reversing the client's Input Tax Credit (ITC) and obtaining a refund from GST due to non-payment. While there isn't a direct provision for the supplier to claim a refund, the consensus is that the client is legally obligated to reverse their ITC if payment isn't made within six months.

CA Altamush Zafar

GST Consultant

10402 Points Posted on 17 February 2021

In this case the customer is not clearing your payment then how can it will effect your itc.
Even though there is no option of refund

Sunil

Business

34 Points Posted on 17 February 2021

Sunil

Business

34 Points Posted on 17 February 2021

Originally posted by : CA Altamush Zafar

In this case the customer is not clearing your payment then how can it will effect your itc.Even though there is no option of refund

No Sir, not our ITC but the clients ITC which is availed from our invoice. Can we get a refund of GST amount paid on such invoice because of clients non-cooperation to pay