GST taxpayers can't claim any pending input tax credit if this return is not filed by November 30, 2024 for FY 2023-24
If you are a goods and services tax (GST) registered taxpayer and want to claim any pending input tax credit (ITC) for FY 2023-24 or amend any errors or omissions under GST then note the last date to do so is November 30, 2024, by filing a specified GST form. If you miss this opportunity, then you may lose out on claiming input tax credit (ITC) if any remains to be claimed for FY 2023-24. Needless to say, if you do not get the benefit of claiming input tax credit then it will result in loss as you can't offset your output tax liability with input tax credit.#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}
How to claim pending GST input tax credit or amend any error or omissions for FY 2023-24
Experts say that the law is very clear about how to claim pending input tax credit (by filing GSTR 3B form) or amend any errors or omissions under GST (through GSTR 1 form). "Any reporting error while filing GSTR 1 can be amended by the taxpayers by way of an amendment while filing GSTR 1 for subsequent tax periods. Input tax credit can only be availed in GSTR 3B return," says Smita Singh, Partner, S&A Law Offices. The deadline to file GSTR 3B return is November 20, 2024, and the deadline for filing GSTR 1 was November 11, 2024. Both the returns can be filed till November 30, 2024, by paying the late fee.
If you need to claim any pending input tax credit do it by November 30 for FY 2023-24
There has been some confusion regarding the deadline. Singh says that as per section 16(4) of the CGST Act, 2017 the time limit to avail pending ITC on invoices pertaining to FY 2023-24 is:
30th November 2024 for invoice pertaining to FY 2023-24; or31st December 2024 i.e. date of filing annual return for FY 2023-24 whichever is earlier.However, both these dates cannot be applicable simultaneously. According to Singh, since input tax credit can only be availed in GSTR 3B return, the time limit to avail input tax credit for invoice(s) pertaining to FY 2023-24 is the last date to file the GSTR 3B return (without any penalty) for October 2024 i.e. November 20, 2024. "The taxpayers may file GSTR 3B return after the due date till 30 November 2024 with late fees and interest for delayed payment of taxes. Therefore, input tax credit for FY 2023-24 can be availed by 30 November 2024 and not by 31 December 2024," says Singh.
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Divya Bhushan, Tax partner, EY India agrees with the above analysis and says that the taxpayer is allowed to claim pending ITC, up to earlier of following dates: a) 30th November following the end of the financial year, or d) due date of furnishing of annual GST return. "Accordingly, pending ITC pertaining to FY 2023-24 can only be claimed up to November 30, 2024, i.e. filing of October 2024 GSTR-3B return," she says.
According to a circular by the Ministry of Finance (dated October 15, 2024) which quoted sub-section 4 of the CGST law: "(4)A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the thirtieth day of November following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier.
New GSTN feature to correct mistakes in GST invoice matching process for claiming input tax credit; Know how it works.
Is it possible to claim any pending input tax credit post November 30, 2024 for FY 2023-24?
Shivam Mehta, Executive Partner at Lakshmikumaran & Sridharan Attorneys says that a doubt with respect to time limit for availment of ITC has been lingering amongst taxpayers since the time this provision has been amended."Considering the language of provision, a doubt persists as to whether the last date for availment of ITC can be considered as return filed for month of November 2024. However, the language is very clear that the ITC cannot be availed post 30th November 2024, as clarified by press release dated 4th October 2022. Thus, the taxpayers must evaluate the missed ITC and claim it in the GSTR-3B filed for October 2024, otherwise, they could lose out on the opportunity to avail pending ITC," he says.
How does filing GST return on time helps in claiming input tax credit
The concept of input tax credit is illustrated via the flow chart below:
Source: Sirmacs Consultancy Services (Law Firm)Source: Sirmacs Consultancy Services (Law Firm)Apoorv Phillips, Senior Associate, Sirmacs Consultancy Services (Law Firm) explains how a problem in claiming input tax credit can occur if GST returns are not filed on time. Philips reiterated that for FY 2023-24 any pending input tax credit needs to be claimed on or before November 30, 2024.
Philips explains: "Based on the flow chart above, let's consider the scenario where the manufacturer collects the GST amount of Rs 1,800 but does not file GST return for more than one year. In this case, the retail dealer becomes ineligible for claiming the ITC for two reasons: first, the supply is not reflected in the dealer's GSTR-2A/B Return, and second, no tax has been paid to the Government by the manufacturer.
However, if the manufacturer decides after one year to pay the GST collected from the retail dealer (Rs 1,800) to the government and files his earlier GST return on January 10, 2026, still the dealer will be ineligible to claim the Input Tax Credit. As, although Mr. A has now paid the tax to the government, and the figure starts reflecting in the GST returns, the ITC will still not be available to the dealer, as the time limit for claiming ITC had already expired on November 30, 2025.
Thus, in most applications of this section, it is the buyer, the rightful taxpayer, who loses valuable ITC. Based on my experience, many of my clients who have paid their taxes to the supplier, who then filed their returns after the time limit under Section 16(4) of the Central Goods and Services Tax Act, 2017, have lost a significant amount of money due to this provision."
Who needs to file GST annual return by December 31, 2024.
November 30, 2024 is also the deadline for making any corrections regarding any error or omission in past GST returns
According to Singh, any reporting error while filing GSTR 1 can be amended by the taxpayers by way of an amendment while filing GSTR 1 for subsequent periods. "Moreover, with respect to GSTR 3B return, since only gross numbers are reported, taxpayers can manually rectify the errors while filing the GSTR 3B for subsequent periods. However, if taxpayers fail to rectify the errors/ omissions in the GSTR 1 and 3B returns of FY 2023-24, annual return for FY 2023-24 is the last resort for pending corrections of errors/ omissions. Any resulting tax liability can be paid by DRC 03 along with interest," she says.Singh says that recently the government introduced a GSTR-1A return form where the invoice level details reported via GRTR-1 of a particular tax period can be amended before filing GSTR 3B for the same tax period. "As a result, correct invoice details will auto-populate in GSTR 3B returns," she says.
According to Mehta, some of the errors which may be rectified are as under:
Reporting of B2B supplies as B2C or vice-versa,Under-reporting or over-reporting of tax liability,Tax head wrongly reported,Payment of reverse charge mechanism (RCM) which has not been paid in the past and availment of input tax credit in respect of the same,Rectification for tax collected at source (TCS) details furnished under Section 52,Credit Note pertaining to FY 2023-24, but not declared in the GST return till date. #sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}
This story originally appeared on: India Times - Author:Faqs of Insurances
