Glossary
ITC
Input Tax Credit
Input Tax Credit allows businesses to reduce the tax they have already paid on purchases from the tax they owe on their sales. It prevents the cascading effect of taxes, ensuring tax is only paid on the value added.
Where it appears in practice
It matters when filing regular GST returns and determining the net tax liability to be paid in cash.
A worked example
You buy raw materials and pay ₹1,000 GST. You sell finished goods and owe ₹1,500 GST. Using ITC, you only pay the ₹500 difference.
Related terms
Let the practice handle it
This term sits inside real compliance work — returns, filings, and deadlines. That work is one of the services the practice runs end to end.
GST Return Filing