What is Input Tax Credit (ITC) in GST?

Input Tax Credit allows businesses to reduce GST payable on sales by the GST already paid on business purchases. This prevents cascading tax. To claim ITC, you need valid tax invoices, the goods must be for business use, the supplier must have filed GSTR-1, and you must file GSTR-3B.

What is the GST Composition Scheme?

The Composition Scheme is for small businesses with turnover up to ₹1.5 Crore. They pay flat GST rates (1% for manufacturers/traders, 5% for restaurants, 6% for service providers) but cannot collect GST from customers, claim ITC, or make inter-state supplies.

GST Calculator India 2025-26

Q: What are the current GST rates in India?

India has 5 GST slabs: 0% (fresh food, milk, cereals), 5% (packaged food, economy travel), 12% (processed food, apparel above ₹1000), 18% (most services, electronics, software), and 28% (luxury cars, tobacco, aerated drinks). Some items also attract a GST Compensation Cess on top of the 28% rate.

Q: What is the difference between CGST, SGST, and IGST?

CGST (Central GST) and SGST (State GST) are levied on intra-state transactions, each at half the GST rate. IGST (Integrated GST) is levied on inter-state transactions at the full GST rate. The total tax is the same — only the split changes. For example, 18% GST intra-state = 9% CGST + 9% SGST. Inter-state = 18% IGST.

Q: How do I calculate GST from a total price?

To extract GST from a GST-inclusive price, divide the total by (1 + GST rate). For example, if a product costs ₹11,800 inclusive of 18% GST: Base price = ₹11,800 ÷ 1.18 = ₹10,000. GST = ₹1,800.

Add or remove GST from any amount instantly. See the CGST + SGST or IGST split, get an invoice-ready breakdown, and calculate your net GST liability after Input Tax Credit. Covers all 5 GST slabs for FY 2025-26.

Enter an amount to add or remove GST instantly

Amount

₹

Enter the price of your goods or services

GST rate

Select the applicable GST slab for your item

Amount includes GST?

Toggle ON if the amount already includes GST (to extract GST from total)

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How to Use This Calculator

GST Calculator tab

Enter the amount, select the applicable GST rate (0%, 5%, 12%, 18%, or 28%), and toggle whether the amount already includes GST. The calculator shows the base price, GST amount, CGST + SGST split, and the total. Use the inclusive toggle to extract GST from a total price.

GST Breakdown tab

Get an invoice-ready breakdown showing CGST/SGST for intra-state transactions or IGST for inter-state transactions. Toggle the inter-state switch to see how the same GST amount splits differently depending on whether buyer and seller are in the same state or different states.

ITC Calculator tab

Enter the GST collected on your sales (output tax) and GST paid on purchases (input tax) to calculate your net GST payable after Input Tax Credit. See your ITC utilisation percentage and whether you have excess credit to carry forward.

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The Formula

GST (Goods and Services Tax) is a destination-based consumption tax levied on supply of goods and services. It replaced multiple indirect taxes (VAT, service tax, excise duty) from 1 July 2017.

GST Exclusive (adding GST):
GST Amount = Base Price × GST Rate
Total Price = Base Price + GST Amount

GST Inclusive (removing GST):
Base Price = Total Price ÷ (1 + GST Rate)
GST Amount = Total Price − Base Price

GST Slabs (FY 2025-26):
0% — Fresh food, milk, cereals, salt, jaggery, fresh vegetables
5% — Packaged food, footwear below ₹1,000, economy air/rail travel
12% — Processed food, business class air travel, apparel above ₹1,000
18% — Most services, restaurants, electronics, software, hair oil, toothpaste
28% — Luxury cars, tobacco, aerated drinks, cement, white goods

Tax Split:
Intra-state: CGST (half) + SGST/UTGST (half)
Inter-state: IGST (full rate)

Input Tax Credit:
Net GST Payable = Output Tax (on sales) − Input Tax (on purchases)
If Input Tax > Output Tax → Carry forward or claim refund

The total GST rate is always the same regardless of intra-state or inter-state — only the split changes. CGST goes to the Central Government and SGST goes to the State Government, while IGST is collected centrally and apportioned to the destination state.

Example

Priya — Buying a laptop for ₹50,000 (before GST) in Maharashtra

Priya is purchasing a laptop from a seller in Mumbai. Laptops attract 18% GST. Since both buyer and seller are in Maharashtra, this is an intra-state transaction.

Step 1: Calculate GST

Base price₹50,000

GST @ 18%₹9,000

Total price₹59,000

Step 2: CGST + SGST split

CGST @ 9%₹4,500

SGST @ 9%₹4,500

Total GST₹9,000

If Priya bought the same laptop from a seller in Karnataka (inter-state), the invoice would show IGST @ 18% = ₹9,000 instead. The total price remains ₹59,000 either way.

ITC Example: Priya's small business

GST on sales (output)₹80,000

GST on purchases (input)₹50,000

Net GST payable₹30,000

Priya collects ₹80,000 GST from customers but claims ₹50,000 ITC on business purchases. She pays only ₹30,000 to the government.

FAQ

What are the current GST rates in India? ▼

India has 5 GST slabs: 0%, 5%, 12%, 18%, and 28%. The 0% slab covers essential items like fresh food, milk, and cereals. The 5% slab includes packaged food and economy travel. The 12% slab covers processed food and apparel above ₹1,000. The 18% slab is the most common, covering most services, electronics, and software. The 28% slab applies to luxury items, tobacco, and aerated drinks. Some items also attract a GST Compensation Cess on top of the 28% rate (e.g., luxury cars, tobacco products).

What is the difference between CGST, SGST, and IGST? ▼

CGST (Central GST) and SGST (State GST) are levied on intra-state transactions (buyer and seller in the same state). Each is half the GST rate. IGST (Integrated GST) is levied on inter-state transactions (buyer and seller in different states) at the full GST rate. The total tax is the same in both cases — only the split changes. For example, 18% GST on an intra-state sale = 9% CGST + 9% SGST. The same 18% on an inter-state sale = 18% IGST. For Union Territories, SGST is replaced by UTGST.

What is Input Tax Credit (ITC) and how does it work? ▼

ITC allows businesses to reduce the GST they owe on sales (output tax) by the GST they have already paid on purchases (input tax). This prevents the cascading effect of tax-on-tax. To claim ITC: (a) you must have a valid tax invoice, (b) the goods/services must be used for business purposes, (c) the supplier must have filed GSTR-1, and (d) you must file GSTR-3B. ITC is not available on personal expenses, food and beverages (unless you are in the restaurant/hospitality business), motor vehicles (with limited exceptions), and goods that are lost, stolen, written off, or gifted.

What is the Composition Scheme? ▼

The Composition Scheme is a simplified GST compliance option for small businesses with turnover up to ₹1.5 Crore (₹75 lakh for special category states). Under this scheme, businesses pay a flat rate of GST: 1% for manufacturers and traders, 5% for restaurants (non-AC), and 6% for service providers. Key limitations: composition dealers cannot collect GST from customers, cannot claim ITC, cannot make inter-state supplies, and must file quarterly returns (CMP-08) instead of monthly. It significantly reduces compliance burden for small businesses.

How do I calculate GST from a total (inclusive) price? ▼

To extract GST from a total price that already includes GST, divide the total by (1 + GST rate). For example, if a product costs ₹11,800 inclusive of 18% GST: Base price = ₹11,800 ÷ 1.18 = ₹10,000. GST amount = ₹11,800 − ₹10,000 = ₹1,800. Use the "Amount includes GST?" toggle in the calculator to do this automatically.

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