GST Input Tax Credit (ITC): Rules, Eligibility & Common Mistakes

Input Tax Credit (ITC) lets a business reduce its output GST by the tax already paid on purchases. Used correctly, it is a major cash-flow benefit — used carelessly, it triggers notices and reversals.

Conditions to Claim ITC

• You must have a valid tax invoice.
• The goods or services must be received.
• The supplier must have paid the tax and filed their return (reflected in your GSTR-2B).
• You must have filed your own return.

Blocked Credits

Certain items are ineligible — motor vehicles (with exceptions), personal consumption, and specific goods/services under Section 17(5). Claiming these is a common error.

Common Mistakes

• Claiming ITC not appearing in GSTR-2B.
• Missing the time limit for claiming credit.
• Not reversing ITC on unpaid supplier invoices after 180 days.

Statura handles GST returns and ITC reconciliation so your credit is maximised and defensible.