Difference between TDS Return and Input Tax Credit

Posted on 11 June 2022 Category : GST terms difference

How to differentiate Input Tax Credit with TDS Return?

What is Input Tax Credit? How does TDS Return work under GST regime? What are the difference between Input Tax Credit and TDS Return?

ITC is a mechanism to ensure that the supplier needs to pay GST in cash only on the value addition. ITC mechanism thereby avoids cascading of taxes that is ‘tax on tax’. Under the previous system of indirect taxation, credit of taxes being levied by Central Government was not available as set-off for payment of taxes levied by State Governments, and vice versa.

The deductor is also required to file a return in Form GSTR-7 within 10 days from the end of the month. If the supplier is unregistered, name of the supplier rather than GSTIN shall be mentioned in the return. The details of tax deducted at source furnished by the deductor in FORM GSTR-7 shall be made available to each of the suppliers in Part C of FORM GSTR-2A electronically through the Common Portal and the said supplier may include the same in FORM GSTR-2.

The details about Input Tax Credit and TDS Return with simple language from GST terms have been mentioned in this web blog separately. We suggest you to read these articles on Input Tax Credit and TDS Return, so as to enable you to have a clear idea on these GST terms.

For your immediate reference, we give below web links on Input Tax Credit and TDS Return separately below. You may kindly read the below links to know more about TDS Return and Input Tax Credit.

Meaning of Input Tax Credit Mechanism in GST

Meaning of term TDS Return under GST

The above information easily explains about TDS Return and Input Tax Credit.

We hope, you have satisfied with the difference between Input Tax Credit and TDS Return explained above. Do you have different thought on difference between TDS Return and Input Tax Credit?

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