Recently government has came out with the changes in the GST Credit utilisation method, which will result in to accumulation of credit on one hand cash payment of GST liability on the other hand. This will ultimately result in to working capital crunch to affected companies. As per new rules priority are changed for setting off the credit against liability.
New rules for GST Credit utilisation
On a reading of the below amendments, the order of set-off of Input Tax Credit will now start with Integrated Tax credit is first to be settled against Central Tax credit or the State Tax credit, or Union Territory Tax credit, as the case may be. Unless and until Integrated Tax credit has been completely utilized, one cannot use the CGST/ SGST credits available. Continue reading “New Rules for GST Credit utilisation”