Question 24 - A person paying tax under compounding scheme crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date?
Input Tax Credit entitlement for former composition taxpayers covers stock and capital goods from the day before scheme cessation. A taxpayer exiting the composition scheme may claim input tax credit for inputs held in stock, inputs contained in semi finished or finished goods held in stock, and on capital goods reduced by prescribed percentage points, measured as of the day immediately preceding the date from which the composition scheme ceases to apply; the rules will prescribe the manner of calculation of eligible credit.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Input Tax Credit entitlement for former composition taxpayers covers stock and capital goods from the day before scheme cessation.
A taxpayer exiting the composition scheme may claim input tax credit for inputs held in stock, inputs contained in semi finished or finished goods held in stock, and on capital goods reduced by prescribed percentage points, measured as of the day immediately preceding the date from which the composition scheme ceases to apply; the rules will prescribe the manner of calculation of eligible credit.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
Join Channel
TaxTMI 
