Input Tax Credit is the lifeblood of GST compliance. Every rupee of ITC missed is a direct cost to the business. Every rupee of ineligible ITC claimed is a penalty risk. An ITC audit identifies both — leakage and risk — and ensures that the ITC position is optimised.
This article explains the ITC audit services a CA firm provides.
ITC Leakage Identification
- Missing invoices: Invoices not reflected in GSTR-2B due to supplier non-filing.
- Timing differences: Invoices received after the GSTR-2B cut-off.
- Classification errors: Eligible ITC classified as ineligible.
- Reconciliation gaps: Differences between purchase register and GSTR-2B.
Ineligible ITC Review
- Blocked credits under Section 17(5): Personal expenses, motor vehicles, food and beverages.
- Exempt supply attribution: ITC attributable to exempt supplies under Rules 42/43.
- Non-business use: ITC on goods or services not used for business.
Recovery Process
- Reconcile GSTR-2B with purchase register.
- Follow up with suppliers for missing invoices.
- File GSTR-3B amendments for missed ITC.
- Claim refund of accumulated ITC.
Conclusion
An ITC audit is not just a compliance exercise — it is a financial recovery exercise. Identifying missed credits and correcting ineligible claims improves cash flow and reduces penalty risk.
At Anuj Desai & Associates, we provide expert GST ITC audit services. Our team identifies leakage, recovers missed credit, and ensures accurate ITC claims.
For a confidential consultation, contact us at office@anujdesaiassociates.com or call 9619456656. Visit our website at https://anujdesaiassociates.com or connect with our founder on LinkedIn at linkedin.com/in/ca-anuj-desai-122547230.