What is an E-Credit Ledger under GST?

Author
By Sakshi Shah on February 18, 2019

An E-Credit Ledger or Electronic Credit Ledger is the ledger where a taxpayer can view the input tax credit of GST claimed in GSTR-3B (on account of purchases and expenses). It is maintained on the GST Portal. Moreover, the balance in this ledger can be utilized for paying tax only and not for paying interest, late fee, penalty etc.

The E-Credit Ledger reflects:

  • Input Tax Credit of GST accumulated from purchases and expenses
  • Input Tax Credit of GST utilized for payment of output tax liability
  • Balance Input Tax Credit that can be utilized in future

The credit of Input GST from purchases and expenses can be used for paying Output GST on Sales.

  • If Input GST > Output GST, excess balance is reflected in E-Credit Ledger
  • If Input GST < Output GST, the difference amount is to be deducted from the E-Credit ledger else difference amount is to be paid by depositing cash in the E-Cash Ledger
What is an E-Cash Ledger under GST?

While filing the monthly GSTR-3B, in Table 6.1 Payment of Tax, the credit balance and cash balance is auto-populated for the payment of Output Tax Liability.

How can I utilize the balance of E-Credit Ledger?

To utilize the credit, the following rules must be considered:

 Output IGSTOutput CGSTOutput SGSTOutput Cess
IGST ITC  ✔️      ①✔️       ②✔️      ③X
CGST ITC✔️      ②✔️       ①XX
SGST ITC✔️      ②X✔️      ①X
Cess ITCXX X✔️      ①

Example

ABC Pvt Ltd has to determine tax liability to file GSTR-3B for July 2018. Below are the details.

ParticularsAmount (Rs.)
Input CGST10,000
Input SGST25,000
Input IGST45,000
Output CGST20,000
Output SGST20,000
Output IGST40,000
GST Input Tax Credit Calculator
Calculate tax liability after utilising input tax credit

Solution

 IGSTCGSTSGST
Tax Payable400002000020000
Input Tax Credit450001000025000
Gross Tax Liability0100000
Remaining ITC500005000
Credit of IGST used for CGST(5000)50000
Credit of IGST used for SGST000
Credit of CGST used for IGST000
Credit of SGST used for IGST000
Net Tax Payable050000
ITC carried forward005000