Input Service Distributor
Section 2(61) of the Central Goods and Services Tax Act, 2017 (‘Act’ for short) defines the expression ‘Input Service Distributor’ as an office of the supplier of goods or services or both which receives tax invoices issued under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services or both having the same Permanent Account Number as that of the said office.
Manner of distribution of input tax credit
Section 20 of the Act provides the procedure for the manner of distribution of input tax credit by the Input Service Distributor. The said Act provides that-
- The Input Service Distributor shall distribute the credit of central tax as central tax or integrated tax and integrated tax as integrated tax or central tax, by way of issue of a document containing the amount of input tax credit being distributed in such manner as may be prescribed.
- The Input Service Distributor may distribute the credit subject to the following conditions, namely:–
- the credit can be distributed to the recipients of credit against a document containing such details as may be prescribed;
- the amount of the credit distributed shall not exceed the amount of credit available for distribution;
- the credit of tax paid on input services attributable to a recipient of credit shall be distributed only to that recipient;
- the credit of tax paid on input services attributable to more than one recipient of credit shall be distributed amongst such recipients to whom the input service is attributable and such distribution shall be pro rata on the basis of the turnover in a State or turnover in a Union territory of such recipient, during the relevant period, to the aggregate of the turnover of all such recipients to whom such input service is attributable and which are operational in the current year, during the said relevant period;
- the credit of tax paid on input services attributable to all recipients of credit shall be distributed amongst such recipients and such distribution shall be pro rata on the basis of the turnover in a State or turnover in a Union territory of such recipient, during the relevant period, to the aggregate of the turnover of all recipients and which are operational in the current year, during the said relevant period.
Return by Input Service Distributor
Rule 65 of Central Goods and Services Tax Rules, 2017 provides that every Input Service Distributor shall, on the basis of details contained in FORM GSTR-6A, and where required, after adding, correcting or deleting the details, furnish electronically the return in FORM GSTR 6, containing the details of tax invoices on which credit has been received and those issued under section 20, through the common portal either directly or from a Facilitation Centre notified by the Commissioner. GSTR 6 has to be filed by every ISD even if it is a nil return.
Form GSTR – 6A
Rule 59 provides that every supplier is required to furnish the details of outward supplies of goods or services or both in Form GSTR – 1 electronically. Rule 59(3) provides that the details of outward supplies furnished by the supplier shall be made available electronically to the Input Service Distributor in Form GSTR -6A through the common portal after the due date of filing the return in Form GSTR – 1.
Section 39(4) provides that every taxable person registered as an Input Service Distributor shall, for every calendar month or part thereof, furnish, in such form and manner as may be prescribed, a return, electronically, within thirteen days after the end of such month.
The details of auto drafted from GSTR – 1 in GSTR – 6A are as follows-
- Year and month;
- GSTIN;
- Legal name of the registered person;
- Trade name, if any;
- Input tax credit received for distribution-
- GSTIN of the supplier;
- Invoice details such as invoice number, date and value;
- Rate;
- Taxable value;
- Amount of tax(IGST, CGST,SGST/UTGST, CESS);
- Debit/Credit note (including amendments thereof) received during the current tax period-
- Details of original document-
- GSTIN of the supplier;
- No.
- Date
- Revised details of documents or details of Debit/Credit note-
- GSTIN of supplier;
- Number;
- Date;
- Value;
- Rate;
- Taxable value;
- Amount of tax (IGST, SGST/UTGST, CGST, CESS)
Form GSTR – 6
The Input Service Tax Distributor is to fill up the details in this Form. The details are as follows-
- Year and month of return;
- GSTIN of Input Service Distributor;
- Legal name;
- Trade name, if any;
- Input tax credit received for distribution-
- GSTIN of supplier;
- Invoice details (invoice number, date and value);
- Rate;
- Taxable value;
- Amount of tax (IGST, CGST, SGST/UTGST, CESS)
- Total eligible ITC/ineligible ITC to be distributed for tax period (the information is to be taken from the table ‘input tax credit received for distribution’;
- Total ITC available for distribution;
- Amount of eligible ITC;
- Amount of ineligible ITC.
- Distribution of input tax credit report in the previous table-
- Distribution of the amount of eligible ITC;
- Distribution of the amount of ineligible ITC;
For both types of distribution, the following information is to be furnished-
- GSTIN of recipient/State if recipient is unregistered;
- ISD Invoice (invoice number, date and value);
- Distribution of ITC by Input service distributor (IGST, CGST, SGST/UTGST, CESS);
- Amendments in information furnished in earlier returns in Table ‘Input tax credit received for distribution’-
- Information furnished in Table ‘Input tax credit received for distribution’ in an earlier period was incorrect;
- Debit notes/credit notes received (original);
- Debit notes/credit notes (amendments)
- Input tax credit mismatches and reclaims to be distributed in the tax period-
- Input tax credit mismatch;
- Input tax credit reclaimed on rectification of mismatch
- Distribution of input tax credit reported in Tables (Amendments in information furnished in earlier returns and Input tax credit mismatches and reclaims to be distributed in the tax period) (plus/minus)-
- Distribution of the amount of eligible ITC;
- Distribution of the amount of ineligible ITC.
- Redistribution of ITC distributed to a wrong recipient (plus/minus)
- Distribution of the amount of eligible ITC;
- Distribution of the amount of ineligible ITC.
- Late fee;
- Refund claimed from electronic cash ledger
- Tax details for refund;
- Bank details
- Verification by the Authorized signatory.
Points to be considered while filing Form GSTR – 6
- ISD details will flow to Part B of GSTR – 2A of the Registered recipients units on filing GSTR – 6;
- GSTR – 6 return can be filed after 10th of the month and before 13th of the month succeeding the tax period;
- ISD has to distribute both eligible and ineligible ITC to its units in the same tax period in which the inward supplies have been received;
- Mismatch liability between GSTR – 1 and GSTR – 6 will be added to input service tax distributor and further input service distributor has to issue ISD credit note to reduce the ITC distributed earlier to its registered recipient units;
- Mismatch liability will be auto populated by the system;
- Refund claimed from cash ledger will result in debit entry in electronic cash ledger.
Current position
The return GSTR-6 for the month of July 2017 was to be filed on or before 13.08.2017. But due to glitches in the portal the due date was extended now and then, the details of which are furnished as below-
- Notification No. 26/2017-Central Tax, dated 28.08.2017 – the due date for the month of July 2017 was extended to 08.09.2017 and for the month of August 2017 was extended to 23.09.2017;
- Notification No. 43/2017-Central Tax, dated 13.10.2017 – the due date for filing GSTR 6 was extended to 15.11.2017 for the month July 2017 to September 2017;
- Notification No. 63/2017-Central Tax, dated 15.11.2017 the due date for the month of July 2017 was extended to 31.12.2017.It was indicated that the due date for the following months would be notified later;
- Notification No. 8/2018-Central Tax, dated 23.01.2018 the due date for the months from July 2017 to February 2018 was extended to 31.03.2018;
- Notification No. 19/2018-Central Tax, dated 28.03.2018, the due date for the months from July 2017 to April 2018 was extended to 31.05.2018;
- Notification No. 25/2018-Central Tax, dated 31.05.2018, the due date for the months from July 2017 to June 2018 was extended to 31.07.2018;
- Notification No. 30/2018-Central Tax, dated 30.07.2018, the due date for the months from July 2017 to August 2018 was extended to 30.09.2018.
GST Council in its 27th meeting held on 4th May, 2018 had approved the basic principles of GST return design. Now in its 28th meeting held on 21st July, 2018, GST Council approved the key features and new format of the GST returns. The draft returns are put in domain for the comments and suggestions of the stakeholders. The last date for submission of the same is on 31.08.2018. On receiving the comments and suggestions the Board will finalize the returns which are hoped that it will be user friendly and easy to file and make the doing of business easily. Further it is also hoped that the portal will be glitches free while filing the returns. Therefore it is hoped that the filing of GSTR 6 will be further extended beyond 30.09.2018.
