What is ITC ?

Input GST is also called ITC

Full form is Input Tax Credit


Types of Input GST

INPUT GST IS OF 3 TYPES

  • Inputs : - Any goods direct or indirect used for furtherance or business (Example :- Purchase of goods, stationary)
  • Capital Goods : - Any Machine or Fixed Asset (Capitalized in books) direct or indirect used for furtherance or business (Example :- Purchase of Machine)
  • Input Services : - Any service used for furtherance of business (Example :- Professional services, Audit Fee)

All these can be Directly or Indirectly used in Business

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When is the date of Input Available?

 

Input Available on Date Goods Received in Premises and Not Invoice Date

If goods received in lots, input available on Date Final lot received

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When is no Input Tax credit Available in GST?

   
Food and Beverages Execept or same type of service
Outdoor Catering
Beauty Treatment
Health Services
Cosmetic and Plastic Surgery
Membership of a Club  
Health and Fitness Centre  
Rent - a- Cab except when made obligatory by govt
Life Insurance for same type of service
Health Insurance  
Travel Benefits (LTC)  
Works Contract Services Except or same type of service
Goods or Services on which tax has been paid under section 10(Composition Scheme)  
Goods or Services received by a non-resident taxable person  
Goods or Services used for personal consumption;  
Goods Lost, Stolen, Destroyed, written off or disposed  
Tax paid in accordance with the provisions of sections 74, 129 and 130(Tax levied because of fraud, misstatement, confiscation of goods).  

 

Important points of capital Goods

  1. All fixed assets are Capital Goods even if not Directly Used for production
  2. If Machine Capitalized in books, it is a Capital Goods
    If Machine not Capitalized in books, it is Inputs.
    Those additions to assets which Increase efficiency of asset beyond its previous capacity are capitalized.

Learn more here


Inputs of Motor Vehicles 

Inputs of Motor Vehicles will be available as follows

  • Goods Transport (Example :- Truck, Tempo)
    For All Business

  • Passenger Transport (Example:- Car, two-wheeler)
    Input Available only to
    Car Selling Business
    Passenger Transport Business
    Motor Driving Training Business

GST Input in Case Payment Not Made

Input Available on Date of Receipt of Goods

But payment should be made within 180 days from date of Invoice

Learn More


Conditions to Claim Input Tax Credit in GST

  1. Person should be in possession of Invoice/Debit Note/Other Documents
  2. He has Received Goods
  3. Tax Charged has Actually been paid to Government in Cash /Credit
  4. He has furnished GST Return

Learn More


What is last Date of Taking Input Tax Credit in GST

Last Date for Taking Input Tax Credit

If we forget to take ITC in current financial year,we can take it in Next Financial Year till Sep Return(GSTR3B) of Next Year

For FY 2017-18(1 Apr 2017 to 31 mar 2018),we can take it till Sep 2018

This has been extended to March 2019 GSTR3B Return for FY 2017-18

(whose due date was 20 23 Apr 2019)

 

However for fy 2018-19,it has not been extended yet

So it is Sep 2019 GSTR3B Return which is 20 Oct 2019

 

As per Section 16 of GST

Last Date of Taking Input Tax Credit is

  1. Due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or
  2. furnishing of the relevant annual return, whichever is earlier.

Learn More

  1. GST - Goods and Services Tax, India
  2. GST Computation & Accounting

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 10 years. He also provides Accounts Tax GST Training in Delhi and Pune.