Last Date for Input Tax Credit Availment and Correction: Ensure Compliance via GSTR-3B Filing

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The due date for compliance with respect to the Input Tax Credit (ITC) availed and reversal of unutilised or ineligible ITC availed is coming up on November 30.

The procedure has to be completed in line with the GSTR-3B return filing for the month of October 2023 for which the due date is November 20.

All taxpayers using the GSTR-3B form are urged to diligently avail the total input tax credit for 2022-23, as detailed in the GSTR-2B statements, ensuring the reversal of any ineligible credits through the designated 4B(1) table in the GSTR-3B form.

In the Budget 2022, the time limit to claim ITC on invoices or debit notes of a financial year was revised to earlier of two dates. Firstly, 30th November of the following year or secondly, the date of filing annual returns.

On a special note, taxpayers who may have mistakenly recorded input tax credit details in the 4B(2) table instead of the correct 4B(1) in previous returns are advised to take swift action. They are urged to contact the Taxpayer Service Division at the Office of the Joint Commissioner, Taxpayer Circle, or the GST Intelligence wing at the district level urgently, well before filing their returns for October.

Finance professionals must be aware of the crucial time limit for claiming Input Tax Credit (ITC) against an invoice or debit note. The earlier of two dates determines this limit:

  1. November 30 of the subsequent financial year.
  2. The date of filing the annual returns in form GSTR-9 for that financial year.

For instance, ABC Enterprises, a buyer with a purchase invoice dated December 8, 2022 (FY 2022-23), wants to claim GST paid on that purchase. As per the criteria laid down to find out the time limit, the two dates are as follows:

  1. November 30, 2023.
  2. The date of filing GST annual return for FY 2022-23 is December 31, 2023.

The earlier of the two is the date up until when ABC Enterprises can claim ITC of FY 2022-23. Therefore, the last date is November 30, 2023, and ABC Enterprises can claim this ITC in any of the tax periods between April 2022 to October 2023.

The following advisory (Electronic Credit Reversal and Re-claimed statement on GSTN) from the GST Network regarding the Electronic Credit Reversal and Re-claimed statement helps clarify changes made in Table 4 of Form GSTR-3B to enable taxpayers in reporting correct information regarding ITC availed, ITC reversal, ITC re-claimed and ineligible.

Accordingly, the reclaimable ITC earlier reversed in Table 4(B)2 may be subsequently claimed in Table 4(A)5 on fulfillment of necessary conditions. Such reclaimed ITC in Table 4(A)5 also needs to be explicitly reported in Table 4D(1).

1) In order to facilitate the taxpayers in correct and accurate reporting of ITC reversal and reclaim thereof and to avoid clerical mistakes, a new ledger namely Electronic Credit and Re-claimed Statement is being introduced on the GST portal. This statement will help the taxpayers in tracking their ITC that has been reversed in Table 4B(2) and thereafter re-claimed in Table 4D(1) and 4A(5) for each return period, starting from August return period.

2) This statement shall facilitate that while re-claiming ITC in GSTR-3B, the amount aligns appropriately with the corresponding reversed ITC. This aims to improve the overall consistency and correctness of ITC reversal and re-claims related transactions. For Monthly taxpayers, the specified return period pertains to August 2023. For those filing quarterly returns, the specified return period corresponds to Q2 of the financial year 2023-24, encompassing the months of July-September 2023.

3) Taxpayers are being provided a facility to report their cumulative ITC reversal (ITC that has been reversed earlier and has not yet been reclaimed) as opening balance for “Electronic Credit

Reversal and Re-claimed Statement”, if any.

The navigation to report ITC reversal balance:

Login >> Report ITC Reversal Opening Balance.


Services >> Ledger >> Electronic Credit Reversal and Re-claimed Statement >> Report ITC Reversal Opening Balance

a. Taxpayers having monthly filing frequency are required to report their opening balance considering the ITC reversal done till the return period of July 2023.

b. In contrast, quarterly taxpayers shall report their opening balance up to Q1 of the financial year 2023-24, considering the ITC reversal made till the April-June 2023 return period.

c. The taxpayers have the opportunity to declare their opening balance for ITC reversal Until 30th November 2023.

d. The taxpayers shall also be provided 3 (three) amendment opportunities to correct their opening balance in case of any mistakes or inaccuracies in reporting. Importantly, until 30th November 2023, both reporting and amendment facilities are accessible.

e. However, after 30th November till 31st December 2023, only amendments will be permitted and the option for fresh reporting will not be available. This amendment facility shall be discontinued after 31st December 2023.

4) With the provision for taxpayers to report their accumulated ITC reversal balance, the portal will subsequently maintain a record of reversal and re-claimed amounts on a return period basis in statement.

Hence, a validation mechanism is incorporated into the GSTR-3B form. This validation will trigger a warning message if a taxpayer attempts to re-claim excess ITC in table 4D(1) than the available ITC reversal balance in the statement along with ITC reversal made in the current return period in Table 4B(2). This warning message would facilitate accurate reporting but the taxpayers will still have the option to proceed with filing.

However, the taxpayers are advised not to reclaim ITC exceeding the closing balance of “Electronic Credit Reversal and Re-claimed Statement” and may report their pending reversed ITC, if any, as ITC reversal opening balance.

5) For monthly taxpayers, the warning message will commence appearing from the GSTR-3B filing for the August 2023 return period. Similarly, for quarterly taxpayers this warning message would start from the filing period covering July to September 2023.

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