CGST Rules 42 & 43 & Section 17(2)
GST Common ITC Apportionment & Capital Goods Reversal Calculator
Accurately calculate monthly common Input Tax Credit (ITC) apportionment and reversals under CGST Rules 42 and 43. Apportion inputs, input services, and 60-month useful life capital goods across taxable, zero-rated, and exempt turnover, and model Rule 42(2) year-end true-up reconciliation with Section 50 interest.
Gross ITC from GSTR-2B including all inputs, services, and capital goods
Credit on goods/services used strictly for personal/non-business purposes
Credit on inputs/services dedicated solely to exempt/nil-rated supplies
Motor vehicles, food/catering, club memberships, personal consumption
Credit dedicated strictly to taxable supplies and exports under LUT/bond
Nil-rated, wholly exempt, non-GST, RCM outward, securities 1%, land/building sale
Gross aggregate turnover during the month (Taxable + Zero-Rated + Exempt)
Total GST paid on machinery/equipment used for both taxable and exempt supplies (60-month useful life)
GSTR-3B ITC Apportionment & Reversal Summary
- Credited to Electronic Credit Ledger (C1)
- ₹6,70,000.00
- Common Input Credit (C2)
- ₹3,20,000.00
- Exempt Ineligible Reversal (D1)
- ₹96,000.00
- Total Rule 42 Inputs Reversal
- ₹96,000.00
- Net Eligible Inputs & Services ITC
- ₹5,74,000.00
- Monthly Capital Goods Credit (Tm = A / 60)
- ₹10,000.00
- Monthly Capital Reversal (Te)
- ₹3,000.00
- Net Effective ITC Retained (Table 4(C))
- ₹5,81,000.00
Frequently asked questions
What is the difference between Rule 42 and Rule 43 under GST?
Rule 42 governs the apportionment and reversal of common Input Tax Credit on inputs and input services (such as raw materials, office rent, auditing, and utilities). Rule 43 governs the apportionment and reversal of common Input Tax Credit on capital goods (such as plant, machinery, and commercial vehicles) over a statutory useful life of 60 months (5 years).
What qualifies as 'Exempt Supplies' (E) for ITC reversal under Section 17(3)?
Under Section 17(3), exempt supplies include nil-rated and wholly exempt goods/services, non-taxable supplies (such as alcohol for human consumption and petroleum products), outward supplies subject to reverse charge (RCM), transactions in securities (valued at 1% of the sale value), and the sale of land and completed buildings.
How is Rule 43 capital goods reversal calculated each month?
Common capital goods ITC (A) is divided by 60 months to obtain the monthly capital credit (Tm = A / 60). The ineligible monthly reversal attributable to exempt supplies is calculated as Te = Tm * (E / F), where E is exempt turnover and F is total turnover. This amount must be reversed each month for 60 months in Table 4(B)(1) of GSTR-3B.
When must the Rule 42(2) annual true-up reconciliation be performed?
The annual true-up must be completed by 30th November following the end of the financial year (or the actual date of filing the annual return in Form GSTR-9, whichever is earlier). Aggregate annual exempt turnover and aggregate annual total turnover are used to recalculate the actual required reversal for the whole year.
What is the Section 50 interest consequence if monthly reversals were under-calculated?
If the final annual true-up reversal exceeds the sum of monthly reversals already made, the difference must be paid via GSTR-3B along with interest under Section 50(1) at 18% per annum calculated from 1st April of the succeeding financial year until the date of payment.
What happens if a business reversed excess ITC during the year?
If monthly reversals exceeded the actual annual true-up requirement, the excess reversed ITC can be legally reclaimed by taking credit in Table 4(A)(5) [All other ITC] of Form GSTR-3B before the 30th November deadline.