Question ID :
40719
Interest - Non Payment of Invoice within 180 days
Mr X purchased goods from Mr Y on 25 Jan 2020 . The ITC on GST on purchase was availed in the month of Jan 2020. The payment for the goods is still not made to the seller and shall happen in Aug 2020. What shall be the implications on ITC availed. (i) Should Mr X reverse ITC in July 2020 .(ii) Even if Mr X reverses ITC in July 2020 , is there any interest implications on ITC availed as the payment of invoice shall happen after 180 days from date of invoice
Posted by
RAHUL PARASRAMPURIA
on
Jul 13, 2020
Filed Under
GST
Reverse GST ITC in July's GSTR3B, pay interest @24% p.a.
Avail that ITC again once payment made to supplier.
Posted by
Ashish Kumar Goyal on
Jul 15, 2020
Answer ID :
80625
2nd Proviso to section 16(2)(d) r/w Section Section 50(1)
Need to reverse credit by adding it to the value of output tax liability and interest to be discharged @ 18% computing the Liability from 20 Feb 2020 to 20 August 2020.After making payment to vendor for value of supply + tax re-avail the credit.
Check interest position in your industry as a practice, take an informed and calculated call.
Posted by
SACHIN AGARWAL on
Jul 16, 2020