ITC (Input Tax Credit) – Table 4 of GSTR-3B

Input Tax Credit (ITC) is an important concept under the Goods and Services Tax (GST) regime in India. ITC is the credit that businesses can claim for the taxes paid on inputs used in the production or delivery of goods and services. One of the crucial aspects of ITC is Table 4 of GSTR-3B. In this blog post, we will discuss ITC and its significance, as well as provide a comprehensive guide on how to fill Table 4 of GSTR-3B to claim ITC.

1.What is Input Tax Credit (ITC)?

As mentioned earlier, Input Tax Credit is the credit that businesses can claim for the taxes paid on inputs used in the production or delivery of goods and services. It is an essential feature of GST, which eliminates the cascading effect of taxes on the final price of goods and services. The input tax paid on inputs such as raw materials, capital goods, and services used in the course of business can be claimed as ITC. The ITC claimed can be used to set off the output tax liability of the business, thus reducing the effective tax burden.

2.What is Table 4 of GSTR-3B?

GSTR-3B is a monthly summary return that businesses need to file under the GST regime. It contains details of the outward supplies, inward supplies, and tax liability of the business for a particular tax period. Table 4 of GSTR-3B contains details of the eligible input tax credit that can be claimed by the business.

3.How to fill Table 4 of GSTR-3B?

Table 4 of GSTR-3B has three sections:

ITC Available (Whether in full or part)

A.This section contains details of the input tax credit that is available to the business. The input tax credit can be availed in full or part depending on the eligibility criteria and the nature of the input. The following details are required to be provided in this section:

a. Integrated Tax (IGST):

The input tax credit of IGST paid on imports, interstate supplies, and taxes paid on reverse charge basis.

b. Central Tax (CGST):

The input tax credit of CGST paid on intra-state supplies and taxes paid on reverse charge basis.

c. State Tax (SGST):

The input tax credit of SGST paid on intra-state supplies and taxes paid on reverse charge basis.

d. Cess:

The input tax credit of cess paid on inputs used in the course of business.

ITC Reversed

B.This section contains details of the input tax credit that is reversed by the business. The ITC can be reversed due to various reasons such as the inputs used for personal consumption, exempt supplies, or inputs used for the production of non-taxable goods and services. The following details are required to be provided in this section:

a. Integrated Tax (IGST): The input tax credit of IGST that is reversed.

b. Central Tax (CGST): The input tax credit of CGST that is reversed.

c. State Tax (SGST): The input tax credit of SGST that is reversed.

d. Cess: The input tax credit of cess that is reversed.

Table 4 of GSTR-3B – New Changes to Format, Reporting Procedure, Impact on Taxpayers

Table 4 of GSTR-3B is an important section that captures the details of input tax credit (ITC) claimed by taxpayers. It is a monthly summary return filed by taxpayers under the GST regime. Recently, there have been some changes to the format and reporting procedure of Table 4 of GSTR-3B. In this blog post, we will discuss the new changes to Table 4 of GSTR-3B, the impact it has on taxpayers, and the reporting procedure.

1.New Changes to Table 4 of GSTR-3B:

The GST Council, in its 43rd meeting held on 28th May 2021, announced changes to the format of Table 4 of GSTR-3B. The changes have been made to capture the ITC claimed by taxpayers in a more granular manner. The new changes are as follows:

a.A new column has been added to capture the ITC claimed on import of goods separately from the ITC claimed on import of services.

b.The ITC claimed on import of goods and services has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

c.The ITC claimed on input services used for making exempt supplies, non-GST supplies, and supplies liable to reverse charge has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

d.The ITC claimed on inputs used for making zero-rated supplies, with or without payment of tax, has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

2.Impact on Taxpayers:

The new changes to Table 4 of GSTR-3B will have a significant impact on taxpayers. It will require them to report their ITC claimed in a more granular manner. Taxpayers will have to maintain a detailed record of their ITC claimed to ensure accurate reporting in the return. The changes will also lead to an increase in compliance requirements for taxpayers.

3.Reporting Procedure:

The reporting procedure for Table 4 of GSTR-3B remains the same. Taxpayers need to follow the following procedure to report their ITC claimed:

a.The ITC claimed on inward supplies and imports of goods and services has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

b.The ITC claimed on input services used for making exempt supplies, non-GST supplies, and supplies liable to reverse charge has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

c.The ITC claimed on inputs used for making zero-rated supplies, with or without payment of tax, has to be reported separately under the CGST, SGST/UTGST, and IGST columns.

d.The total ITC claimed has to be reported in the last row of the table.