Input tax credit reversal for stock and capital goods requires proportionate calculation, certification, output tax inclusion, and prescribed disclosure. Input tax credit reversal is computed proportionately from invoices for stock inputs and goods, while capital-goods credit is based on remaining useful ... Summary
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Input tax credit reversal for stock and capital goods requires proportionate calculation, certification, output tax inclusion, and prescribed disclosure.
Input tax credit reversal is computed proportionately from invoices for stock inputs and goods, while capital-goods credit is based on remaining useful life over five years. Each tax component is determined separately. Missing invoices require market-price estimation and certification by a practising chartered accountant or cost accountant. The calculated amount is added to output tax liability and disclosed in prescribed forms; capital-goods credit under section 18(6) uses the same method and, when it exceeds tax on transaction value, is furnished in FORM GSTR-1.
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