ITC Eligibility on delayed payment of RCM Tax for services taken from registered supplier

[Shailesh Chechani]

Dear Sir/Ma'am,

If a taxpayer has taken the RCM service from the registered supplier in FY 2018-19 but he comes to know in that he didn't paid the tax on such RCM services yet & decided to make the payment in June-25 along with applicable interest & penalty.

The query is whether the recipient is eligible to avail the ITC on such delayed payment of RCM tax as the benefit of Circular number-211/2024 regarding issuance of self-invoice is not applicable in this case as supplier is registered under GST Act.

AI Summary

Input Tax Credit on reverse charge may be claimed when outstanding RCM tax is paid with required documentation.
ITC for RCM services from a registered supplier becomes available only upon actual payment of the outstanding RCM tax; therefore a recipient who pays the liability through the electronic cash ledger and deposits applicable interest and penalty may claim ITC in the return for the period when payment is made, provided a self-invoice (or reconstructed self-invoice) and supporting documentation accompany the claim, and the payment is recorded via the appropriate return or payment form.