GST Law Guidelines for Tax Credits and Returns

CA Praveen Kumar K

S. No S. No Topic Topic 1 Input Tax Credit S.140 2 Job Work S.141 3 Miscellaneous S.142

Form GST TRAN (60 days form AD) + credited in electronic credit ledger Form GST PMT Form GST TRAN- -1 1 Stock Returns Miscellaneous Capital Goods Form GST PMT- -2 2 In - Transit

Returns Returns S. 140 (1) S. 140 (1) Registered Taxable Person (NOT being CoT) + Credits in earlier returns Rules: Notes: 1. Credits should be eligible under GST Law 2. Last 6 Months Returns filed in TOTO 3. NOT relating to goods manufactured and cleared under Notified EN value of claims under CST Act + value of declarations submitted in support of claims (Return (Return - -> Return) > Return)

Credit of Stock of Inputs in RM/ Registered Taxable person Credit of Stock of Inputs in RM/ WiP WiP/ FG / FG 140 (3) 140 (3) + Not liable for registration under earlier law / manuf. Of exempted goods / pro. of exempted services / WC + Abat. /FSD / SSD / RI Notes: 1. Such stock intended for making taxable supplies 2. Credits should be eligible under GST law 3. Possession of Invoice evidencing payment of duty (exception for traders benefit passed on) 4. Document not older than 12 months 5. Supp. of Sr. is NOT Eligible for Abat. Notes: Rules Credit available @ 40% of central Tax if goods were not wholly exempt / Nil Rated under Excise Credit available after payment of Central Tax (i.e. reimbursement) Scheme applicable for six tax periods from AD Document for procurement of such goods is available Statement at the end of each tax period Stock to be separately identifiable. (Direct credit in GST Return) Rules (Direct credit in GST Return)

Provision Provision Procedure Procedure Registered Taxable Person (NOT being CoT) + Unavailed credit + Not carried forward in return + Admissible under both laws In respect of every item of capital goods tax availed / utilized under each of earlier law tax yet to be availed / utilized under each of earlier law (Direct credit in GST Return) (Direct credit in GST Return)

Provision Provision Procedure Procedure Registered Taxable Person + I/IS received after appointed day (not required for CG) + Taxes paid before appointed day + Recorded in BoA in 30 days (+30 days extension) of appointed day + Furnish a Statement (Direct credit in GST Return) Name of Supplier, Serial Number & date of Invoice Description, Quantity & Value of G/S Amount of eligible taxes / duties Date on which receipt of G/S recorded in BoA of the recipient (Direct credit in GST Return)

S. 140 (6) S. 140 (6) Composition to Normal Scheme Composition to Normal Scheme Registered Taxable person + Paying tax under CoT under earlier laws + Credit of I of stock on hand(Not for IS & CG) Notes: 1. Such stock intended for making taxable supplies 2. NOT opting for CoT under GST 3. Credits should be eligible under GST law 4. Possession of Invoice evidencing payment of taxes (no relaxation) 5. Invoice is not older than 12 months

Input Service Distributor S. Input Service Distributor S. 140 (7) 140 (7) Payment of Input CCR reversed due to non-payment within 3m of Invoice date + payment is made in 3m of AD = Take ITC in GST Return Payment of Input Services S. 140 (9) Services S. 140 (9) Services received prior to AD + Distributed as GST Credit Centralized Registration Centralized Registration S. 140 (8) S. 140 (8) CCR c/f in Return filed before AD or 3 months of AD (Org. Return / Revised Return only if less than Org. Return) + Credit is admissible under GST Law Credit Transfer to Any Regd. Persons (i.e. Branch Office)

Inputs Inputs Semi Removed SFG to any premises For Manf. Process + Returned / direct removal in 6m (2m extension) Semi- -Finished Finished Goods Goods Finsihed Removed FG to any premises For non- Manf. Process + Returned / direct removal in 6m (2m extension) = Finsihed Goods Goods Removed to a JW + For any purpose + Returned in 6m from AD (2m extension) = = NO TAX PAYABLE NO TAX PAYABLE NO TAX PAYABLE (If NOT ITC shall be recovered under GST) Declaration of stock on AD to be given by manufacturer & other person (Form GST TRAN (If NOT ITC shall be recovered under GST) (If NOT ITC shall be recovered under GST) (Form GST TRAN- -01) 01)

S.No 1 S.No Head Head Particulars Particulars Dutiable Goods cleared 6m before AD + returned in 6m after AD + duty paid under earlier law Contract entered prior to AD + Price revision upwards Contract entered prior to AD + Price revision downwards (ex. Deficiency in Service) Refund applied in earlier law Dutiable If returned from URD Apply for refund If returned from RD RD to charge GST 2a Debit note under GST within 30 days of revision 2b Credit note under GST within 30 days of revision Reduction in tax liability only if ITC reversed by recipient To be paid in cash. If rejected no ITC (to be reflected in BS) Refund route, No self adjustment. 3/4 5 Excess amount paid as Service Tax

S.No 6 S.No Head Head Particulars Particulars Proceedings/appeals initiated under earlier law for CENVAT Proceedings/appeals initiated under earlier law for Output Tax Adjudicating proceedings under earlier law Revision of return under earlier law To be paid under earlier law in cash Recovered under old law / new law. 7 To be paid under earlier law in cash Recovered under old law / new law. 8 To be paid under earlier law in cash Recovered under old law / new law. 9 Increase in liability recovery under old law / new law + no ITC is admissible Decrease in liability Refund in cash. (for return revised in time limit) Refund in cash.

S.No 10 S.No Head Head Particulars Particulars Supply made after AD + Taxes under earlier law not paid Supply made after AD + Taxes under earlier law paid Pay GST 11(c) Pay GST + output tax paid under earlier law Take credit of output tax 11(a/b) Supply made prior to AD + Levy of VAT / ST + Time of Supply as per GST GST not payable Time of Supply as per GST

S.No S.No Head Head Particulars No Tax payable Particulars Goods sent on approval basis + 6m prior to AD + Returned to Seller + within 6m (+2m) from AD If goods returned after 6m from AD If goods not returned (Declaration Form GST TRAN-01) 12 Tax payable by person returning goods Tax payable by person sending the goods TDS not liable under GST 13 Sale liable for TDS + Invoice raised before AD

S.No 1 2 3 S.No Particulars Particulars Pending litigations to be given thought WcT stock credit only for 26/2012 Relook at credits not taken Dept. audit ex Windmill Credits taken to the extent required Credit taken on payment basis SP don t take credit thinking they are not registered under ED Invoices kept in stores pending for some mismatch (Reco between GRN & CCR) CHA Bills Inputs returned after 180 days falling after AD, recredit not available Even if Invoices addressed to Sales Office, SP can take credit Higher reversal of CENVAT for common credits

S.No 4 S.No Particulars Particulars Audit for reason for accumulation of credit 100% taken in CCR, Dept reversal in Dec 17, re-credit not available 2% Credit taken under Excise Amortization of tools etc not done Overlapping contracts option to pay ST / VAT Centralized Accounting not possible the same way (you can still register in Home branch & supply across India) Credit of CG not taken, no time limit applies (anti profit clause to be kept in mind) Procurement from Excise Dealers Transfer of factory / change in ownership enter into return before AD 5 6 7 8 9

S.No 10 S.No Particulars Particulars Advance received in Pre-GST Era, ST not paid, Supply made in GST era, GST Paid, Dept. may recover ST revenue neutrality also cannot be claimed Not covered in Transitional Provisions Payment not made in 90d & CCR not reversed recovered by Department, CCR not available when payment is made. Pay RcM before AD, despite PoT being after AD Tax payment under GST is not for HSN/STC it is for CGST/SGST/IGST Audit of Cenvat Credit Proper accounting of CCR for R-6, reversal in CCR & claim in GST ITC of tax paid u/s 12 in VAT for June 2017 ? 11 12 13 14 15 16

S.No 17 18 19 S.No Particulars Particulars Stock Transfer Partial rebating Unsold Stock on 30.06.2017 Stock Transfer 110% of Cost Rule 8 Short payment to avoid Goods sent on exhibition / Display Transitional provision doesn t cover this scenario Surrender Registration if not required Branches of different States to be included in Centralized Registration Supplementary Invoice post GST may be beneficial If CA below threshold better to get registered, otherwise client will have to pay under RcM 20 21 22 23

CA Praveen Kumar K 9865121775 praveen.ca88@yahoo.com