Rule ITC setoff 88A

Mr. Lingam,

Please elaborate the concern.

Credit Note for Sales Return?

Means you have returned the Goods to the seller?

Mr. Lingam,

Then your Input of IGST would get reduced by 62000.

Input of CGST/SGST=50000 & IGST=218000 (i.e. 280000 - 62000) 

Output of CGST/SGST=90000 & IGST=190000

Output of IGST 190000 would get set off with Input of IGST 190000 (Input IGST of 28000 would remain)

Output of CGST/SGST 90000 would get set off with Input of IGST 28000 (in any order or proportion) say, 14000 each.

Output of remianing CGST/SGST i.e. 62000 would get set off with Input of CGST/SGST 50000 say, 25000 each.

Output of remaining CGST/SGST i.e. 12000 needs to be paid in Cash say, 6000 each.

Set Off can be made in below mentioned order:

First, ITC of IGST needs to be used to set off IGST Liability.

Second, ITC of IGST needs to be used to set off CGST or SGST Liability, in any order or proportion. Make sure that ITC of IGST is exhausted before moving ahead.

Third, ITC of CGST or SGST can be used to set off other liability as applicable in below mentioned order.

ITC of CGST with CGST then IGST

ITC of SGST with SGST then IGST

You can refer to the below link for more details.

https://www.cbic.gov.in/htdocs-cbec/gst/Circular-98-17-2019-GST.pdf

 

Input of CGST/SGST=50000 & IGST=218000 (i.e. 280000 - 62000)  Output of CGST/SGST=90000 & IGST=190000

Is CGST/SGST mentioned here is for both or each?

If it is for each:

If it is for both:

Yes, as you dont have that much of ITC available with you

Please share your way of setting off.