What is an E-Credit Ledger under GST?
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
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 IGST||Output CGST||Output SGST||Output Cess|
|IGST ITC||✔️ ①||✔️ ②||✔️ ③||X|
|CGST ITC||✔️ ②||✔️ ①||X||X|
|SGST ITC||✔️ ②||X||✔️ ①||X|
|Cess ITC||X||X||X||✔️ ①|
ABC Pvt Ltd has to determine tax liability to file GSTR-3B for July 2018. Below are the details.
|Input Tax Credit||45000||10000||25000|
|Gross Tax Liability||0||10000||0|
|Credit of IGST used for CGST||(5000)||5000||0|
|Credit of IGST used for SGST||0||0||0|
|Credit of CGST used for IGST||0||0||0|
|Credit of SGST used for IGST||0||0||0|
|Net Tax Payable||0||5000||0|
|ITC carried forward||0||0||5000|