Brief about Refund of Unutilized Input Tax Credit (ITC)
SURENDER / 2020-01-31 06:49:03

Brief about Refund of Unutilized Input Tax Credit (ITC)

Refund is a term which means refund of taxes or funds, when paid more than the actual tax/funds to be given. In GST, the tax refund comes into play when:
a) the input tax credit(ITC) of a supplier gets collected as a result of making zero rated supplies or
b) supplier pays charges which he’s not required to and hence, claims GST paid
According to section 54 of the CGST Act, it includes the refund of:
·         excess tax paid
·         interest paid on such tax
·         any amount paid which was not required to be paid
·         input tax pertaining to goods or services exported outside India
·         tax on inputs or input services used to make goods or services exported outside India including zero rated supplies
·         tax on goods regarded as deemed exports
·         unutilized input tax credit in case of zero rated supplies made under bond or LUT and inverted duty structure
What is meant by Input Tax Credit (ITC)?
Input Tax Credit means difference between the taxes paid on inputs from that paid on output. On supply of services or goods to a taxable person, GST charged is called Input Tax.
For Example:-
Mr. A collected tax on the Sale of a Goods/Services).
 INR 500.
Mr. A paid tax for purchase of Goods/Services.
INR 300
So, Final taxes to be paid by Mr. A
INR 200
Input tax credit that can be claimed by Mr. A
INR 300
Required Conditions for Filing GST Refund Application
Ø GSTR1 & GSTR 3B must have been filed for the period for which the return is to be claimed.
Ø Every year taxpayers having more than Rs.1.5 crores as turnover can file for GST refund.
Ø  Taxpayers who opt quarterly GST return filing, can file GST refund application every quarter of the year.
Application Process for Claim
The application process for claiming refund shall include:
(a)Every documentary evidence to establish that a refund is due to the applicant.
(b) Every documentary or other evidence to establish the amount of tax and interest paid.
Once the application is submitted, the final decision is in the hands of the tax officer and as per the decision the refund is provided.
If you need any further help regarding GST registration online, or GST return filing feel free to contact us 8766393412.

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