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GST: Changes and method to claim Input Tax Credit answered

GST: Changes and method to claim Input Tax Credit answered

Ever since the GST came into effect on July 1, 2017, the Indian economy has seen a plethora of regulations implemented by the GST council. Now the department is using analytics to keep tab on the errant taxpayers who are claiming excess input tax credit or to track some taxpayers who are not serious about the matching of their GSTR - 3B with their GSTR - 2A. The Input Tax Credit (ITC) is one of those regulations that is causing some confusion among the masses. Here is a brief explanation of what ITC means, how it will affect the masses- especially small business owners, and what are the necessary steps needed to be taken.

What is ITC?
Input tax credit (aka ITC) is the subtraction of the tax money you have paid on inputs on the final output bill.

Who can avail of ITC?
ITC is available to an entity only when it is covered under the GST Act. Any manufacturer, supplier, agent or e-commerce operator aggregator must be registered under the GST if it is to become eligible to claim the ITC on their purchases which are used in the course and furtherance of business.

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