The tax paid, which acts as an asset because it can be claimed as Input Tax Credit (ITC) to offset future tax liabilities on sales.
IGST applies only when the "Place of Supply" is in a different state from the buyer's registered location.
When you purchase goods from another state, the transaction is recorded by debiting the purchase and tax accounts and crediting the supplier: Particulars (Taxable Value) XXXcap X cap X cap X Input IGST A/c (Tax Amount) XXXcap X cap X cap X To Supplier / Creditor A/c (Total Invoice Value) XXXcap X cap X cap X Purchase A/c: The net cost of goods before tax.
One of the major benefits is that the full IGST paid on purchases can be used to pay off Output IGST, CGST, or SGST liabilities.
Zimbabwe
