REFUND OF INPUT CREDIT FOR EXPORTERS

[rohit patodi]

what would be my adjusted turnover and net ITC in case of refund of input tax credit availed on inputs in case of exporters. For eg., an exporter has exported goods on LUT worth rs 2500000 in July period and in the same period he has done taxable sale within state worth rs 500000 and tax is ₹ 12500 cgst and sgst. So Total sale would be 3000000 rs. He has total input on purchases amounting to ₹ 150000 cgst and sgst. Thus input left at the end of the tax period at the end of the month is 150000-12500 i.e 137500.

In this case, how can I calculate adjusted turnover and net ITC?

[SURYAKANT MITHBAVKAR]

You have to calculate on following method

Total export turnover X Net ITC available (after adjusting against local supply)/ Total turnover (local supply + Export)

After arrive input credit please verify your credit ledger balance is equal to that amount if yes you are eligible of 90% refund.

[rohit patodi]

But net NET ITC as per definition given is total availed during the relevant period. Thus I think it should not be itc left after adjusting the output liablity

[SURYAKANT MITHBAVKAR]

Then you are not entitled for refund since you are adjusting Export input credit against your domestic supply.

After adjusting credit against domestic supply your credit ledger shown nil.

Either you can adjust your credit against domestic supply or you can apply refund.

AI Summary

Refund of input tax credit: apportion Net ITC to exports and reconcile ledger before claiming refund.
Refund is computed by apportioning available credit: refund = (total export turnover x Net ITC available after adjusting against local supply) / total turnover (exports plus domestic supplies). The apportioned amount must be reconciled with the credit ledger; if the ledger equals that amount the exporter is eligible for the refundable percentage. If input tax credit is instead used to discharge domestic output liability and the credit ledger is reduced to nil, there is no refundable balance for exports.