Transfer of Input Tax Credit from one Branch to another.

5123 views

Save Share

Ankur Aggarwal

Sr. Executive-Accounts & Finance

21 Points Posted on 25 March 2020

Hello,

I am asking on behalf of my company, Actually we have 3 Branches (Noida (HO), Bangalore & Chennai) across the globe wherein BLR & CHN branches having Input tax Credit only and not having Output tax Liability. Noida Branch is having both ITC and the Output tax liability as revenue Invoices are generate from Noida Head office only. So Please let us know that how could we claim ITC of BLR & CHN too under Noida GSTIN? or Do we need to register those 2 branches as ISD first? Your help will be highly appreciated.

Thanks

Ankur Aggarwal

Replies (4)

Quick Summary

This discussion addresses the challenge of transferring Input Tax Credit (ITC) between different branches of a company. It clarifies that direct transfer of ITC between branch e-credit ledgers is not permitted. The advice suggests registering one branch as an Input Service Distributor (ISD) to distribute common service-related ITC on a pro-rata basis, but notes this doesn't apply to capital goods or input purchases. Refund of ITC is generally restricted to zero-rated supplies or inverted tax structures.

CA Naveen Chand

Chartered Accountant

8022 Points Posted on 25 March 2020

Firstly , Transfer of INPUT TAX CREDIT is not allowed from one branch e-credit ledger to another branch e-credit ledger .

Secondly , INPUT TAX CREDIT CAN NOT be taken as REFUND from the department EXCEPT in two case

1. where supply is zero rated supplies (export) and there is inputs of purchases or

2. In case of , INVERTED TAX STRUCTURE

Lastly , you can take registration of any of the branch as ISD and distributed ITC on pro rata basis for the common invoices of services only (capital goods input OR inputs on purchases can not be distributed via ISD )

RAJA P M

"Do the Right Thing...!!!"

77833 Points Posted on 25 March 2020

Yes... I agreed to Mr Naveen chand reply...

@ Mr Ankur Aggarwal.,

ITC can't be transfer from one gstin to another gstin...

as per you.,
BLR & CHN only have ITC not output then how is You move goods which is ITC related inputs...?!

Murari Karmhe

22 Points Posted on 08 July 2021

Transfer of ITC is allowed only when associated assets are also transferred.

Ramesh Ramsinghaney

22 Points Posted on 04 May 2023

Dear Sir,

We are civil contractor with Head Office at Chandigarh and projects where billing is taking place is Haryana, New Delhi and Noida.

We have separate GST registration for the Four States. We have accumulated GST ITC in Chandigarh which has accrued against Bank Charges and Commissions paid by us to bankers.

Kindly advice how can we transfer available ITC at Chandigarh to any of these state mentioned above.

Kindly advice if we can raise GST invoice from Chandigarh on respective states for which we got the Bank Guarantees made? Alternative method that comes to mind is to raise invoice from Chandigarh on the respective states in the ratio of sales achieved by each states

Thanks & Regards,

Dhiraj Kumar