GST Credit Notes: Use Original Invoice Rate for Returned Goods, Not Revised Rate

• GST credit notes for returned goods should use the original invoice rate, not the revised rate.
• Confusion arises when goods are returned after a GST rate change.
• A recent case involved goods supplied at 12% GST, with a rate reduction to 5% before return.
• The Central Goods and Services Tax Act, 2017, mandates credit notes reflect the original supply rate.
• Section 34 requires credit notes to match the original invoice rate.
• Section 14 applies only to new supplies after a rate change, not to returned goods.
• Proper linkage between invoices and credit notes is essential for compliance.

Source: taxscan.in

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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