There will be change in GST, new rule coming on ITC; It will be difficult to claim more ITC
New GST Rule: The GST department may soon approve the new rule on ITC. After this rule, if a businessman claims additional ITC, then he will have to tell about the difference between GSTR-1 and GSTR-3B. This rule will be applicable only if the difference in both ITCs is more than 20 percent or Rs 25 lakh.
A new rule on Input Tax Credit can be brought soon by the GST Council. After the introduction of this rule, if a trader claims additional Input Tax Credit (ITC), then the tax authorities will have to explain the reason in detail.
News agency PTI quoted sources as saying that a law committee has also been formed in this regard, which includes tax officers of the Center and the state. Opinion has been given by the committee. ITC received in return GSTR-3B Auto Generated Statement If the difference in ITC received in GSTR-2B is more than the prescribed limit, then the registered person has to report the difference or refund the excess ITC with interest.
It has been recommended by the committee that this rule will be applicable only when the difference in ITC is more than 20 percent and more than 25 lakhs.
The GST Council is likely to take a decision on this recommendation in its meeting to be held on July 11. At present, businesses use the tax paid by their suppliers, commonly known as ITC, to offset their GST liability while paying tax in GSTR-3B.
If the difference in tax liability in GSTR-1 and GSTR-3B exceeds the prescribed limit of Rs 25 lakh or 20 percent, then the businessmen will have to explain the reason for this difference or deposit tax.
With this, the GSTR-2B form is being created by GST Network, which will auto-draft the ITC statement. It will inform the taxpayer about ITC availability and non-availability on each document of his supplier.
