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RCM Query on ITC ?
If GST is paid on RCM Services but Payment to supplier of such RCM Services is not made within 6 months. Does ITC needs to be reversed ?
Replies (2)
No ... no need , As per 2nd proviso to section 16(2) of CGST states that reversal of credit is not applicable in case tax payable in Reverse Charge
Hence no need to Reverse
Hence no need to Reverse
No need to Reverse Credit.
As from Section 16 of CGST Act 2019..
Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed:
As from Section 16 of CGST Act 2019..
Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon, in such manner as may be prescribed:
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