Mastering GSTR-9: A Deep Dive into Reporting Inward Supplies and Input Tax Credit
- Nikhil hirani
- Sep 30
- 9 min read
Updated: Oct 1
Foreword: Navigating the Complexities of ITC in the Annual Return
Welcome to the second installment of our comprehensive series on filing the GSTR-9 Annual Return. While the first article laid the groundwork by explaining the reporting of outward supplies, this guide tackles what is arguably the most scrutinized and complex aspect of the annual return: Input Tax Credit (ITC). The accuracy of your ITC reporting is paramount, as it directly impacts your tax liability and is a primary focus area for departmental audits.
This article provides a detailed, table-by-table analysis of Part III (Tables 6, 7, and 8) and the ITC-related sections of Part V (Tables 12 and 13) of the GSTR-9 form. We will demystify the requirements, clarify common points of confusion, and provide practical examples to guide you through a compliant and error-free filing process.
INDEX
Section 1: Table 6 - The Foundation of Your ITC Claim in GSTR-9
Table 6 is the starting point for all ITC reporting in the GSTR-9. Its purpose is to provide a detailed, category-wise breakup of the total ITC you have availed in your monthly or quarterly GSTR-3B returns throughout the financial year.
The Unchangeable Baseline: Table 6A
The entire ITC reconciliation process begins with Table 6A, which is an auto-populated and non-editable field.
Table 6A: Total amount of Input tax credit availed through FORM GSTR-3B. This figure is the sum total of all ITC claimed in Table 4A of your GSTR-3B returns for the financial year. It serves as the definitive baseline that the rest of your declarations in Table 6 must reconcile with.
Snapshot of Table 6
Table 6 | Details of ITC availed during the financial year | IGST | CGST | SGST/UTGST |
A | Total amount of ITC availed through FORM GSTR-3B (sum total of Table 4A of FORM GSTR-3B) | |||
B | Inward supplies (other than imports and inward supplies liable to reverse charge but includes services received from SEZs) | |||
C | Inward supplies received from unregistered persons liable to reverse charge... on which tax is paid & ITC availed | |||
D | Inward supplies received from registered persons liable to reverse charge... on which tax is paid and ITC availed | |||
E | Import of goods (including supplies from SEZs) | |||
F | Import of services (excluding inward supplies from SEZs) | |||
G | Input Tax credit received from ISD | |||
H | Amount of ITC reclaimed... | |||
I | Sub-total (B to H above) | |||
J | Difference (I - A above) | |||
K | Transition Credit through TRAN-I | |||
L | Transition Credit through TRAN-II | |||
M | Any other ITC availed but not specified above | |||
N | Sub-total (K to M above) | |||
O | Total ITC availed (I + N above) |
The Crucial Bifurcation: Tables 6B to 6H
The subsequent rows require you to manually break down the total ITC from Table 6A into specific categories. The sum of these rows should perfectly match the figure in 6A.
Table 6B (Inward supplies other than imports and RCM): This is the most common category, covering ITC on domestic purchases from registered suppliers. A key requirement here is to bifurcate this ITC into Inputs, Capital Goods, and Input Services.
Practical Challenge & Relaxation: Many businesses find it difficult to maintain records with this specific bifurcation. Recognizing this, the government has provided a significant relaxation: taxpayers have the option to report the combined ITC for inputs and input services entirely under the "Inputs" row. However, the value of ITC on Capital Goods must always be reported separately.
Tables 6C & 6D (Inward supplies liable to RCM): This is for ITC claimed on taxes you paid under the Reverse Charge Mechanism (RCM). It is split between supplies from unregistered persons (6C) and registered persons (6D).
Relaxation: Taxpayers have the option to report the consolidated details of both 6C and 6D under Table 6D alone.
Table 6E & 6F (Import of Goods & Services): These fields are for reporting the IGST paid on the import of goods (including from SEZs, if a Bill of Entry is filed) and the import of services, respectively.
Table 6G (ITC from ISD): This is for reporting ITC received from an Input Service Distributor.
Table 6H (ITC Reclaimed): This field is specifically for reporting ITC that was first availed, then reversed, and subsequently reclaimed within the same financial year.
Example: Filling Table 6
Let's assume ABC Corp. has a total ITC of ₹10,00,000 auto-populated in Table 6A from its GSTR-3B returns. The company's internal records show the following breakdown:
ITC on raw materials (Inputs): ₹5,00,000
ITC on professional services (Input Services): ₹1,00,000
ITC on a new machinery purchase (Capital Goods): ₹2,00,000
ITC on RCM liability paid to a registered GTA: ₹50,000
ITC on import of goods: ₹1,50,000
Here’s how ABC Corp. would fill Table 6, using the available relaxations:
Table | Description | IGST | CGST | SGST/UTGST |
6A | Total ITC from GSTR-3B | ₹1,50,000 | ₹4,25,000 | ₹4,25,000 |
6B | Inward Supplies (Inputs + Input Services) | ₹3,00,000 | ₹3,00,000 | |
Inward Supplies (Capital Goods) | ₹1,00,000 | ₹1,00,000 | ||
6D | RCM from Registered Persons | ₹25,000 | ₹25,000 | |
6E | Import of Goods | ₹1,50,000 | ||
6I | Sub-total (B to H) | ₹1,50,000 | ₹4,25,000 | ₹4,25,000 |
6J | Difference (I - A) | ₹0 | ₹0 | ₹0 |
The total of the manual entries in rows 6B, 6D, and 6E equals the auto-populated figure in 6A, resulting in a nil difference in Table 6J, which indicates a correct primary reconciliation.
Section 2: Table 7 - Reporting ITC Reversed and Ineligible ITC
After declaring the total ITC availed, Table 7 requires you to detail the portion of that credit that was reversed during the financial year. This includes both temporary reversals and permanently ineligible credits.
Snapshot of Table 7
Table 7 | Details of ITC Reversed and Ineligible ITC for the financial year | IGST | CGST | SGST/UTGST |
A | As per Rule 37 (Non-payment to supplier) | |||
B | As per Rule 39 (ISD credit note) | |||
C | As per Rule 42 (Inputs/services for exempt/non-business use) | |||
D | As per Rule 43 (Capital goods for exempt/non-business use) | |||
E | As per Section 17(5) (Blocked Credits) | |||
F | Reversal of TRAN-I credit | |||
G | Reversal of TRAN-II credit | |||
H | Other reversals (if any) | |||
I | Total ITC Reversed (Sum of A to H above) | |||
J | Net ITC Available for Utilization (6O – 7I) |
Understanding the Reversal Categories
Table 7A (Rule 37): Reversal of ITC if you fail to pay your supplier within 180 days of the invoice date.
Table 7B (Rule 39): Reversal of ITC distributed by an ISD, typically due to a credit note issued to the ISD.
Table 7C & 7D (Rules 42 & 43): These are for reversals of "common credit" used for both taxable and exempt/non-business purposes. Rule 42 applies to inputs and input services, while Rule 43 applies to capital goods. These require a formula-based calculation based on turnover.
Table 7E (Section 17(5)): This is for reporting permanently "blocked" credits that can never be claimed. Common examples include ITC on food and beverages, club memberships, and motor vehicles (with certain exceptions).
Table 7H (Other reversals): This is a catch-all for any other reversals.
Relaxation: The government allows taxpayers to report the consolidated value of reversals from Tables 7A to 7E under Table 7H. However, reversals of transitional credit (7F and 7G) must be reported separately. While this simplifies filing, providing a rule-wise breakup demonstrates greater transparency.
Example: Rule 42 Reversal Calculation
A business has the following annual figures:
Common ITC on inputs/input services (C2): ₹2,00,000
Turnover of exempt supplies (E): ₹20,00,000
Total turnover in the state (F): ₹2,00,00,000
The reversal amount under Rule 42 is calculated as:
Reversal (D1) = (Exempt Turnover / Total Turnover) * Common ITC
Reversal (D1) = (₹20,00,000 / ₹2,00,00,000) * ₹2,00,000 = ₹20,000This amount of ₹20,000 would be reported in Table 7C.
Section 3: Table 8 - The Ultimate ITC Reconciliation
Table 8 is the most critical part of ITC reporting. It reconciles the ITC available to you as per the GST system (based on your suppliers' filings) against the ITC you have actually claimed in your returns. Discrepancies in this table are a major trigger for departmental notices.
Snapshot of Table 8
Table 8 | Other ITC related information | IGST | CGST | SGST/UTGST |
A | ITC as per GSTR-2A/GSTR-2B | |||
B | ITC as per sum total of 6(B) and 6(H) above | |||
C | ITC on inward supplies... received during the previous FY but availed during the current FY | |||
D | Difference | |||
E | ITC available but not availed | |||
F | ITC available but ineligible | |||
G | IGST paid on import of goods (including supplies from SEZ) | |||
H | IGST credit availed on import of goods (as per 6E above) | |||
I | Difference (G-H) | |||
J | ITC available but not availed on import of goods | |||
K | Total ITC to be lapsed in current financial year (E + F + J) |
Decoding the Reconciliation Logic
Table 8A (ITC as per GSTR-2A/GSTR-2B): This is an auto-populated, non-editable field showing the total ITC available to you based on the GSTR-1 returns filed by your suppliers. For FY 2023-24 onwards, this data is sourced from the static GSTR-2B statement.
Table 8B (ITC as per 6B + 6H): This is also auto-populated from within your GSTR-9 and represents the ITC you claimed on regular inward supplies during the financial year.
Table 8C (ITC of previous FY availed in current FY): This is a manual entry field where you report ITC that pertained to the previous financial year but was claimed in the current year's GSTR-3B.
Table 8D (Difference): This field calculates the difference: 8A – (8B + 8C).
A positive value means there is ITC in your GSTR-2B that you have not claimed.
A negative value is a significant red flag, indicating you have claimed more ITC than is visible to the department, which will likely lead to scrutiny.
The subsequent fields (8E, 8F) are used to explain any positive difference in 8D.
Case Study: A Practical Reconciliation of Table 8
Let's analyze the data for PQR Ltd. for FY 2023-24:
Total ITC auto-populated in Table 8A from GSTR-2B: ₹15,00,000
Total ITC on regular inward supplies claimed in GSTR-3B during the year (auto-populated in Table 8B): ₹14,20,000
ITC for FY 2023-24 that was missed and claimed in GSTR-3B of May 2024 (to be reported in Table 8C): ₹30,000
Reconciliation Steps:
Calculate Total Claimed ITC: 8B + 8C = ₹14,20,000 + ₹30,000 = ₹14,50,000.
Calculate the Difference in Table 8D: 8A - (Total Claimed ITC) = ₹15,00,000 - ₹14,50,000 = ₹50,000.
Analyze the Difference: The company investigates the positive difference of ₹50,000 and finds:
An invoice with ITC of ₹20,000 was for employee health insurance, which is a blocked credit under Section 17(5).
An invoice with ITC of ₹30,000 was valid, but the accountant simply forgot to claim it.
Report the Analysis:
In Table 8F (ITC available but ineligible), report ₹20,000.
In Table 8E (ITC available but not availed), report ₹30,000.
Calculate Lapsed ITC: Total ITC to be lapsed in Table 8K = 8E + 8F = ₹30,000 + ₹20,000 = ₹50,000.
This step-by-step process provides a clear and justifiable explanation for the difference between the ITC available in the system and the ITC actually claimed.
Section 4: Part V - Reporting Previous Year's ITC Adjustments (Tables 12 & 13)
Part V is designed to handle timing differences for ITC—transactions that belong to the previous financial year but were accounted for in the current year's GSTR-3B returns.
Table 12 (Reversal of ITC availed during previous FY): Use this table to report any ITC that was availed in the previous financial year but was subsequently reversed in the current year's GSTR-3B. For example, ITC claimed in March 2023 is found to be ineligible and is reversed in the GSTR-3B of June 2023.
Table 13 (ITC availed for the previous FY): This is for reporting ITC that pertained to the previous financial year but was claimed in the current year's GSTR-3B (within the specified time limit).
The Critical Link: Table 13 and Table 8C
It is essential to understand that Table 13 and Table 8C report the exact same information. The value entered in both tables must match. This intentional duplication ensures that cross-period ITC claims are captured and reconciled from both a credit availability perspective (Part III) and a timing adjustment perspective (Part V).
Conclusion
Mastering the reporting of inward supplies and ITC in GSTR-9 is a non-negotiable aspect of annual GST compliance. The intricate web of Tables 6, 7, 8, 12, and 13 requires a systematic approach, starting with a robust reconciliation of your books of accounts with your monthly GSTR-3B filings and the system-generated GSTR-2B. Common errors such as incorrect bifurcation of ITC, mismatches in Table 8, and confusion between Tables 8C and 13 can be avoided with careful preparation. By treating this process not as a year-end chore but as a continuous, monthly discipline, you can ensure accuracy, minimize the risk of scrutiny, and file your GSTR-9 with confidence.
About the Author
Nikhil Jain is a Founder and CEO of TAXPATH INDIA with over 7 years of experience in taxation and compliance. He specializes in GST implementation and has helped numerous businesses navigate the complexities of indirect tax compliance
Contact Information:
Email: contact@taxpathindia.com
Phone: +91-9042364130
Website: www.taxpathindia.com
Disclaimer:
This article is for informational purposes only and should not be considered as professional tax advice. Readers are advised to consult qualified tax professionals for specific compliance requirements and business decisions.
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