Know About Input Credit on Job Work
GST is implemented in lower than 4 months. so there is a large number of issues and doubts are not resolved yet.
One of the major bills which create so many troubling for manufacturing industry is called Input credit on job work.
the Main manufacturer company forward goods for next process to a job worker.
Here below is the basic structure of the form of GST ITC-04
What is job work?
Job work means processing or working on raw materials or semi-finished goods supplied by the principal manufacturer to the job worker. This is to complete a part or whole of the process which results in the manufacture or finishing of an article or any other essential operation.
A suit Manufacturer sends half Raw material for made suits to Job Workers(Tailors). In this case, the main manufacturing firm will be allowed to take credit for tax paid on the purchase of such goods(Suit’s Raw Material) sent on job work.
As per GST Act, job work means any treatment or process undertaken by a person on goods belonging to another registered person. The person doing the job work is called job worker.
Input Credit to available in both cases when goods sent to Job Worker:-
- From principal’s place of business:- is the primary location where a taxpayer’s business is performed.
- Directly from the place of supply of the supplier of such goods