Section 9 - Payment of tax

Section 9 - Guidelines for Using Input Tax Credit

This section outlines how businesses should use the input tax credit available in their electronic credit ledger to pay various taxes. First, any credit from integrated tax should be used to pay integrated tax. If there is any remaining credit, it can then be used to pay central tax and state or union territory tax, in that order. For credit from union territory tax, it should first be used to pay union territory tax. Any leftover credit can be used to pay integrated tax, but only if there is no available credit from central tax to cover the integrated tax. Importantly, credit from union territory tax cannot be used to pay central tax. These rules are designed to ensure that tax credits are applied in a specific order, helping to maintain clear and organized tax payment processes.