cgst rule 86 electronic credit ledger (2024)

FAQs

What is the rule 86 for electronic credit ledger? ›

(1) The electronic credit ledger shall be maintained in FORM GST PMT-02 for each registered person eligible for input tax credit under the Acton the common portal and every claim of input tax credit under the Act shall be credited to the said ledger.

Rule 86B is with a non-obstante clause. This implies that this rule overrides all other rules of GST from the date of its enforcement, i.e., 1st January 2021. Below mentioned are the applicability conditions: The rule applies to GST-registered businesses with more than 50 lakhs taxable valued goods in a month.

Let us know the GST rule 86B with the help of an example-

Suppose a businessperson sells goods valued at Rs 2 crore; the tax rate is 14 per cent. As per the rule notification, the person is liable to discharge up to 99 per cent of his total tax liability through the help of ITC and must pay Rs 28000 in cash.

No, the amount may continue to remain in the Electronic Credit Ledger and can be utilised for any future liability. Refund can only be claimed if ITC has been accumulated due to export of goods and/or services and/or due to rate of tax on outward supplies being lower than inward supplies.

Rule 86A of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as "the Rules") provides that in certain circ*mstances, Commissioner or an officer authorised by him, on the basis of reasonable belief that credit of input tax available in the electronic credit ledger has been fraudulently availed or ...

Penalties on violation of rule 86B

GST Registration taxpayer shall be liable to pay a penalty of minimum penalty ₹ 10,000/- and maximum penalty equal to the tax evaded, whichever is higher. It is one time penalty for one offence.

It means at least 1% of tax liability must be paid by cash. It applies to such taxpayers who have monthly value of taxable supplies more than Rs.50 lakh (not being exempt or zero-rated supplies).

ITC can be availed only on goods and services for business purposes. If they are used for non-business (personal) purposes, or for making exempt supplies ITC cannot be claimed . Apart from these, there are certain other situations where ITC will be reversed.

Let us understand new GST set off rules with examples

And the taxpayer has to pay nothing in cash. But, as per the new GST ITC set off rules 2022, IGST credit of 200 shall be utilized towards the payment of output liability of Rs. 100 of IGST and Rs. 100 of CGST.

What is the rule 88B of Cgst rules? ›

Rule 88B of the CGST rules provides the manner in which interest should be calculated on delayed GST payments. The 53rd GST Council meeting held on 22nd June 2024 recommended benchmark changes to Rule 88B and the interest calculation thereof.

Rule 89 – Application for refund of tax, interest, penalty, fees or any other amount. [Explanation. —For the purposes of this sub-rule, ― “specified officer” means a “specified officer” or an “authorised officer” as defined under rule 2 of the Special Economic Zone Rules, 2006.]

e-Ledger is an electronic form of passbook for GST, containing details on cash deposited, input tax credit balance, and manner of setoff. Electronic Cash Ledger is like an e-wallet for cash payments. Electronic Credit Ledger reflects claimed tax credit. Electronic Liability Ledger details GST liability and payments.

Whenever the registered person avails new 'Input Tax Credit', the same is credited (i.e., added) in 'Electronic Credit Ledger'. Similarly, whenever, the registered person uses/ utilizes the availed 'Input Tax Credit', the same is debited (i.e., subtracted) in 'Electronic Credit Ledger'.

Log in to the GST website using your credentials. Click on the “Services” button, then on “Ledgers”, and then on “Electronic Credit Ledger”. On the Electronic Credit Ledger page, you will be able to check the input tax credit balance as of today's date as well as Blocked Credit Balance and Provisional Credit Balance.

'Electronic Credit Ledger' reflects the amount of eligible input tax credit claimed by the registered person via GST returns i.e. Form GSTR-3B or auto-populated return Form GSTR-2B. Importantly, the registered person can make payment of only tax (IGST or CGST or SGST or UTGST or Cess) via 'Electronic Credit Ledger'.

Rules of posting in the General ledger

The amount shown on the credit side in the journal must be posted on the credit side of the general ledger. The amount shown on the debit side in the journal must be posted on the debit side of the general ledger. In particulars, the account head must start with the “To” and “By.”

e-Ledger is an electronic form of passbook for GST, containing details on cash deposited, input tax credit balance, and manner of setoff. Electronic Cash Ledger is like an e-wallet for cash payments. Electronic Credit Ledger reflects claimed tax credit. Electronic Liability Ledger details GST liability and payments.

Where an agent supplies or receives any taxable goods on behalf of his principal, such agent and his principal shall, jointly and severally, be liable to pay the tax payable on such goods under this Act.