GSTRefund of inverted duty structure
Khan Sabab (35 Points)
21 September 2020
Pls guide for GST refund regarding.
4 Replies
Pankaj Rawat
(GST Practitioner)
(55052 Points)
Replied 21 September 2020
Inputs subject to tax at a higher rate than the rate applicable on outward supplies of goods or services commonly known as ‘inverted duty structure’ could result in a situation where the registered person has accumulated input credit. Under the provisions of the first proviso to sub-section 3 of Section 54 of the CGST Act a registered person may claim refund of unutilised input credit where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on outward supplies, other than nil rated or fully exempt supplies.
As per Rule 89 , the refund can be claimed by following formula:
Maximum Refund Amount = {(Turnover of inverted rated supply of goods) x Net ITC ÷ Adjusted Total Turnover} – tax payable on such inverted rated supply of goods “Net ITC” means input tax credit availed on inputs and input services during the relevant period; “Adjusted Total turnover” means the turnover in a State or a Union territory, as defined under clause (112) of section 2, excluding the value of exempt supplies other than zero-rated supplies, during the relevant period;
Procedure :
1. File application in form RFD01 through common portal.
2. The application shall be accompanied by a statement containing the number and the date of the invoices received and issued during a tax period .
3. Need to upload GSTR 2A of Relevant period.
4. Statement of Invoices ,-Annexure B.
As per Rule 89 , the refund can be claimed by following formula:
Maximum Refund Amount = {(Turnover of inverted rated supply of goods) x Net ITC ÷ Adjusted Total Turnover} – tax payable on such inverted rated supply of goods “Net ITC” means input tax credit availed on inputs and input services during the relevant period; “Adjusted Total turnover” means the turnover in a State or a Union territory, as defined under clause (112) of section 2, excluding the value of exempt supplies other than zero-rated supplies, during the relevant period;
Procedure :
1. File application in form RFD01 through common portal.
2. The application shall be accompanied by a statement containing the number and the date of the invoices received and issued during a tax period .
3. Need to upload GSTR 2A of Relevant period.
4. Statement of Invoices ,-Annexure B.
CA Saloni
(Manager-Accounts & GST Consultant)
(5124 Points)
Replied 23 September 2020
Also, Make sure while calculating the refund amount consider only inputs and the order of claiming the refund ie first under IGST then CGST and SGST equally.
Recent Topics
- Clarity regarding Sec 16(4)
- GST ON HOTEL ROOMS details
- Relief for Delayed Filing of Tax Forms
- Expire stock
- INCOME TAX AY 25-26
- Experienced CA firm for accounting & auditing
- Regarding Perquisite Tax on ESOP - Unlisted Compan
- Casual Taxable Person under GST
- Extended Date of GSTR-1 for the month of July 2020
- NRO Interest - Taxed at source and in Foreign Coun
Related Threads
CAclubindia
