Input Tax Credit Guide | Input Tax Credit under GST
What is an input tax credit? Input tax credit (ITC) means taxes paid on purchases of goods or services can be claimed at the time of payment of taxes on output. For example , Mr. Juneja is running a garments shop, and in the month of November, he paid a tax of Rs 1000 on purchases and collected tax of Rs 1500 from customers. In the instant case, the tax of Rs 1000 paid by Mr. Juneja is ITC and can be reduced while making payment of tax dues. Accordingly, he is liable to deposit Rs 500 (1500-1000) to the government. Similarly, In Goods and Services tax , a registered taxpayer can claim the GST paid on purchases against GST liability on outward supplies. Undoubtedly, ITC is one of the major reliefs provided to the taxpayers in the GST regime. But the fact also cannot be denied that a lot of amendments in ITC provisions have created complications not only for businesses but for CA professionals also. Let’s proceed towards the solution you are looking for. Conditions to...