GST
Credit notes from suppliers reduce GSTR-2B ITC
Updated . Every paid answer is checked by a CA. Free AI answers are labelled until a CA verifies them.
Facts
A supplier's credit note reduces the ITC available to you, and it appears in GSTR-2B as a negative entry. If you ignore it and claim the original credit, your GSTR-3B claim exceeds GSTR-2B.
Provisions and law
- Sec 34, CGST Act 2017Credit and debit notes; credit notes must be declared by 30 November of the next year
- Sec 16(2)(aa), CGST Act 2017ITC only when the invoice is furnished by the supplier and communicated in GSTR-2B
- Rule 88D, CGST Rules 2017Intimation DRC-01C when ITC in GSTR-3B exceeds GSTR-2B beyond a limit; reply in 7 days
Analysis
If a supplier issued a credit note with tax of ₹18,000 for a price discount, your net credit falls by ₹18,000. Recent IMS changes require action on credit notes as well, so check what you accepted. Pay back the reduced credit or explain if the credit note is disputed and you rejected it.
Conclusion
- Find credit notes in GSTR-2B and IMS for the period
- Check whether you reduced your claim
- Pay back or explain in Part B
- Agree credit notes with suppliers each month
A Savvy can do this for you
ITC mismatch
Quote
Get this doneAsk a Savvy on WhatsAppGeneral guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.