Tax Consultant
366 Points
Posted on 22 May 2026
ITC transfer from an individual firm to an LLP is allowed under Section 18(3) of the CGST Act, but only when the transfer is on a going concern basis, meaning the entire business or an independent part of it is being handed over. The process requires filing Form GST ITC-02 by the transferee (the new LLP) on the GST portal, with the transferor accepting it. A key condition is that the LLP must be registered under GST. If the transfer is treated as a supply rather than a going concern transfer, ITC does not move and the original registrant may need to reverse credit under Rule 44. For a full picture on what qualifies for ITC and what gets blocked, this [GST ITC eligibility and GSTR-2B reconciliation guide](https://taxgarden.in/blog/gst-input-tax-credit-eligibility-gstr-2b-reconciliation) covers the framework that applies before and after restructuring.