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GST ITC Claiming Conditions Under CGST Section 16 for Taxpayers

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ITC Claiming Conditions Under GST Section 16

Any individual registered is being permitted to avail of the credit for the input tax. 

Definition of Input Tax Credit 

Input tax concerning the enrolled individual directed to the central tax, state tax, or union territory tax imposed on any goods or services supply or both incurred to him, the same excludes the tax furnished beneath the composition levy.  The input tax credit is directed to the credit provided on the input tax.

What Would be the Situation to Claim the ITC U/S 16?

Sec 16 of CGST act used to furnished some conditions, the ITC would be availed post to fulfilling the mentioned conditions:

  • For the businesses or in extending the businesses, the mentioned goods or services or both are used. 
  • Possession of tax-paying document: a registered individual is in the possession of the tax filing document like the tax invoice or debit note or the entry bill or additional tax-paying documents. 
  • Receipt of goods or services: An enrolled individual obtains the goods or services. The Goods that would be obtained via the agent of such an individual or through any other individual grounds would be acknowledged to be the receipt of goods. 
  • Tax levied actually furnished to the government: The tax levied towards these supplies would be actually furnished to the government via supplier either in cash or via the usage of the ITC. 
  • Payment would not be incurred in the mentioned duration of 180 days from the invoice date: No tax credit is permitted if the enrolled individual would not make the payment to the supplier. 
  • Goods obtained in lots or installments: When the last installment has been obtained, then the tax credit would be permitted.
  • If depreciation is availed on the tax element of a capital asset, no input tax credit will be given: If the depreciation would be availed on the value of the capital assets including with the element of the tax, the ITC on the mentioned element would not be permitted, if the tax credit is being opted by the enrolled individual of the input tax then it would not be sum to the capital assets cost. 
  • Return Filing: The input tax credit could be claimed post to the last date of return filing towards the September month of the subsequent fiscal year or on filing the related yearly return whichever comes before.

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