Not paid your supplier within 180 days? How GST input tax credit is reversed and reclaimed

Last updated 27 Oct 2026 · India

Short answer. The second proviso to section 16(2) of the CGST Act and rule 37 say that if a recipient does not pay the supplier the value of the supply plus tax within 180 days from the invoice date, the input tax credit already availed on it must be added to output tax liability, with interest under section 50. Under rule 37 as amended in 2022, the amount is shown in GSTR-3B for the period immediately after the 180 days end. When you later pay the supplier, you can re-avail the credit. It does not apply to supplies taxed under reverse charge, to deemed supplies without consideration under Schedule I, or to amounts added to value under section 15(2)(b).

Monthly check

Pull your purchase ledger with invoice dates and payment status.
List invoices older than 180 days that are unpaid or part-paid.
For part payment, reverse ITC in proportion to the unpaid amount.
Report the reversal in GSTR-3B (ITC reversed: others) and pay interest.
When paid, re-claim the credit in GSTR-3B and keep payment proof.

Common mistakes

Counting 180 days from goods receipt instead of the invoice date.
Reversing the whole credit when part has been paid.
Not re-claiming the credit after paying.

Not tax advice. This is a free explainer of the CGST Act and Rules; check the latest notifications on CBIC or ask your tax adviser.

Frequently asked questions

From which date are the 180 days counted?

From the date of the supplier's invoice.

Is interest payable when ITC is reversed for non-payment?

Yes, interest under section 50 applies on the credit added back to output tax.

Can I take the ITC again after paying the supplier?

Yes. Once you pay the value and tax, the credit can be re-availed.

Official sources

Not tax or legal advice. This is a free explainer of public rules; deadlines and rules can change by notification, so confirm on the official portal or with your CA before you file. Last checked 27 Oct 2026.

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