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Under Section 16(4) of the CGST Act, 2017, by when must a registered person take input tax credit on an invoice relating to a financial year, assuming no special relief applies?

Question and options

Under Section 16(4) of the CGST Act, 2017, by when must a registered person take input tax credit on an invoice relating to a financial year, assuming no special relief applies?

  1. 30 November following the end of the financial year, or the date of the annual return, whichever is later

  2. 30 November following the end of the financial year, or the date of the annual return, whichever is earlier

  3. 31 December following the end of the financial year, or the date of the annual return, whichever is earlier

  4. The due date of the September return after the financial year, or the date of the annual return, whichever is earlier

Answer and explanation

Correct answer: B - 30 November following the end of the financial year, or the date of the annual return, whichever is earlier

Section 16(4) of the CGST Act, 2017 bars credit on an invoice after the 30 November following the end of the financial year to which it relates, or the date of furnishing the annual return, whichever is earlier. The September return was the cut-off before the Finance Act, 2022, and 31 December is the due date of the annual return, not the credit deadline.

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