Rule 86B - Restrictions on use of amount available in electronic credit ledger

Large taxpayers' 99% GST credit set-off cap, requiring 1% cash payment, with income tax, refund and PSU exemptions

Registered persons whose monthly value of taxable supplies (excluding exempt and zero-rated supplies) exceeds fifty lakh rupees are restricted from discharging more than 99% of output tax liability using the electronic credit ledger, requiring payment of at least 1% through the electronic cash ledger. The restriction does not apply where specified persons have paid more than one lakh rupees as income tax in each of the last two relevant financial years, or where the registered person received refunds exceeding one lakh rupees in the preceding financial year on account of unutilised input tax credit under section 54(3), or where cumulative cash payment in the current financial year exceeds 1% of total output tax liability, or where the registered person is a Government Department, PSU, local authority, or statutory body, or (other than a manufacturer) only for specified goods under rule 31D taxed on retail sale price basis. The restriction may be removed on verification by the Commissioner.