Companies get notices for seeking input tax credit on GST paid by their vendors

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Many companies are reportedly under the scanner of the tax department with authorities beginning to quiz input tax credit claimed by firms in lieu of Goods and Services Tax (GST) paid by their vendors. Tax sleuths have issued notices to companies in several states, including Gujarat, Telangana, Andhra Pradesh, and Haryana, confirming apprehensions that inspection will intensify in the new financial year as the government looks to plug the leaks, says an Economic Times report.

It may be noted that the GST rule allows a reversal of input tax credit claimed by a company if its vendor has not paid the tax for which credit is being claimed. At present, there is no procedure to determine if vendors have paid GST. The return-filing status of a registered person can only be viewed on the GST Network Portal, but payment of tax cannot be determined. Buyers can only validate whether vendors have included the invoice in their GST filings, the report mentioned.

Read More at: https://www.timesnownews.com/business-economy/economy/article/companies-get-notices-for-seeking-input-tax-credit-on-gst-paid-to-vendors/409815