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CA India, official logo of the Institute of Chartered Accountants of IndiaCA (Dr) Aman SalujaChartered Accountant
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Input tax credit

How input tax credit works under GST: conditions for claim, auto-drafted statements, blocked credits, and the annual time limit.

Eligibility (section 16)

ITC is available on inward supplies used in the course or furtherance of business, subject to conditions: possession of a tax invoice/debit note, receipt of goods or services, tax actually paid to the Government, and filing of return.

GSTR-2B

GSTR-2B is an auto-drafted ITC statement. Reconcile books with GSTR-2B before claiming credit in GSTR-3B.

Blocked credits (section 17(5))

Certain credits are blocked, for example motor vehicles (with exceptions), food and beverages, outdoor catering, beauty treatment, health services, club membership, and works contract for immovable property (subject to exceptions). Always check the Act and notifications.

Time limit to claim ITC

ITC for a financial year is generally claimable up to 30 November following the end of the financial year, or the date of filing the relevant annual return, whichever is earlier.

Rule 36(4) / invoice matching

Credit should align with invoices appearing in the auto-drafted statements. Mismatches between GSTR-1 of the supplier and the recipient’s claim attract scrutiny.

Related: ITC cut-off on calendar · Returns · Invoicing

This material is for general information. It is not a legal opinion. Verify due dates and rates on the GST portal and CBIC notifications before acting.