13 June 2023
I need some clarification, I have filed CMP04 after notification 02/2022. But after March 2022 I had 200000 ITC, and I have not claimed any ITC since April 2022. Can I offset ITC of 200000? While I have chosen the slab of 6%.
10 July 2024
Based on the information provided, let's clarify the scenario regarding your Input Tax Credit (ITC) and filing under the Composition Scheme (CMP-04) after Notification 02/2022.
### Understanding CMP-04 Filing and ITC Offset:
1. **Composition Scheme (CMP-04):** - CMP-04 is a statement filed by a taxpayer opting for the Composition Scheme under GST. It declares the details of stock and inward supplies from unregistered persons or Composition taxable persons.
2. **ITC Accumulation:** - You mentioned that after March 2022, you have accumulated ITC amounting to 200,000 INR. - Under the Composition Scheme, businesses are generally not eligible to claim ITC on purchases. However, ITC accumulated before opting for the scheme can be used.
3. **Offsetting ITC:** - Since you have chosen the 6% slab under the Composition Scheme, you are not eligible to claim ITC on purchases made after opting into the scheme. - Any ITC accumulated before opting into the scheme can be utilized against output tax liabilities until it is exhausted or until the end of its validity period.
### Steps to Utilize ITC:
- **Utilization Against Output Tax:** You can offset the accumulated ITC of 200,000 INR against your output tax liability under the Composition Scheme. - **Validity Period:** Ensure that the ITC is within its validity period (usually within one year from the end of the financial year in which it was accumulated).
### Important Considerations:
- **Compliance:** While filing GST returns under the Composition Scheme, ensure that you accurately report your turnover and pay tax at the prescribed rate (6% in your case). - **ITC Adjustment:** The ITC accumulated before opting into the Composition Scheme should be adjusted systematically against your GST liability to avoid any lapse or penalties.
### Conclusion:
Given your scenario, you can indeed offset the accumulated ITC of 200,000 INR against your output tax liability while filing GST returns under the Composition Scheme. Ensure compliance with GST regulations and maintain proper records of ITC utilization for audit and compliance purposes. If you have further doubts or need specific guidance tailored to your situation, consulting a GST professional or tax advisor would be beneficial.
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