If you are a buyer or a purchaser, you might be aware of the perils of having credit lapses or having your Input Tax Credit (ITC) blocked because your supplier has not upload their invoices. This is a prevalent problem that most buyers and purchasers reel under. This issue crops up partially because the supplier may not have filed their GST return on time, which would have mandated them to upload their invoices and documents, or has made an error while uploading the invoices. As a result, the buyer struggles with not being able to use their GST credit, which might be cause for concern, especially if your GST credit is a hefty amount.
Before we dive deep into how can you as a buyer get GST credit if your supplier has not uploaded their invoices, let’s understand a few basic concepts to keep in mind:
What is Input Tax Credit & how can I claim it under GST?
Input Tax Credit is the tax that has already been paid on the purchase of goods and services by the buyer and can be deducted from the tax payable.
Ideally, as a buyer, a few things are mandatory for you to claim a GST credit on a purchase. These are:
- You must have a debit note or a valid tax invoice that the supplier issues to kickstart the process of claiming a GST credit.
- It is a must to have received the entire consignment of goods and/or services.
- The supplier must have paid the due tax to the Government via claiming input credit.
- The supplier must have mandatorily filed their GST returns.
- To claim the Input Tax Credit, as a buyer, you must clear the supplier’s payment within 180 days of the supplier raising an invoice.
- The supplier is required to have uploaded the invoices or the debit note(s) provided in the Form GSTR-1 and must be communicated to the concerned buyer in the Form GSTR-2B.
The most important documents here are the Form GSTR-1 and the Form GSTR-2B. The biggest catch here is that if you as a buyer want to get GST credit, your supplier must complete all due diligence at their end when it comes to GST. Thus, if they have not uploaded the invoices, or not paid the due taxes that they have collected from you, or has not filed their return, or has made an error filing their return while uploading documents and invoices, it reduces your chances of successfully claiming an Input Tax Credit.
Let us now explore what you can do to claim an input tax credit if the supplier didn’t upload the invoice.
What to do if my supplier has not uploaded their invoices?
Until January 1, 2022, Rule 36(4) of the Central Goods and Services Tax Rules, 2017, allowed a buyer to avail up to 5% of the GST as provisional credit. This helped buyers when their suppliers had deposited the requisite GST with the Government but did not upload the mandatory tax invoices. This non-invoice return previously was placed in the 10% slab before being capped at 5% to prevent the misuse of the feature.
If there was a discrepancy in the invoice number or the amount of GST deposited with the Government, the reconciliation feature allowed the supplier party to make amendments and corrections on the GST portal for the buyer to claim their due GST credit.
However, after multiple reports of discrepancies, it was decided in the 38th GST Council Meeting that the filing of Form GSTR-1 by the supplier will become non-negotiable and mandatory for the buyer to claim a GST credit and avoid getting caught in the vicious loop of double taxation.
It is now compulsory to include the details of the invoices issued by the supplier under the buyer’s GSTN number in addition to the total invoice value and the taxable amount. All these details are a must when computing the Input Tax Credit.
The latest updates have also made e-invoicing a mandatory practice for those filing their GST each month and claiming GST credits.
You can now use KYSS to help you track supplier GST filings every month to stay on top of your GST credit and make sure you have everything in place to claim your credit in a fuss-free manner.
The GST Council and the Ministry of Finance have tightened the GST credit rules. Now, as a buyer, you will have to mandatorily have your supplier upload the required tax invoices that make you eligible to get GST credit. The supplier’s lack of a tax invoice will make the buyer ineligible for getting a GST credit. As a result, you will not get an input tax credit if the supplier didn’t upload the invoice.
Hence, you can only communicate with your supplier on a channel outside the GSTN and ask them to upload the requisite documents and tax invoices mentioning your name (or the company’s name) and your GSTN number.
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