Thursday, April 11, 2024

GST ITC-04: A Detailed Guide to Filing, Compliance, and Penalties

GST ITC-04 is a critical compliance document under the GST framework, detailing the movement of goods for job work. This guide offers an in-depth look at its purpose, filing through both the GST portal and Tally, compliance deadlines, and potential penalties for non-compliance.

Purpose of ITC-04

ITC-04 aims to ensure transparency in the movement of goods to and from job workers, thereby aiding in the accurate calculation and utilization of input tax credits. It encapsulates:

  • Tracking Goods Movement: Monitoring the flow of inputs and capital goods sent to or received back from job workers.
  • Input Tax Credit Management: Facilitating the optimal use of input tax credits tied to job work transactions.

Components of ITC-04

The form includes two primary sections:

  1. Goods Dispatched to Job Worker: Lists inputs and capital goods sent during a quarter.
  2. Goods Received from Job Worker: Records goods received back or forwarded to another job worker, including challan details.

Filing Procedure: GST Portal and Tally ERP 9

  • GST Portal:

    1. Access: Log in to the GST portal with valid credentials.
    2. Navigation: Select 'Services' > 'Returns Dashboard', choosing the relevant financial year and period.
    3. Method: Opt for either online entry or the offline utility for batch uploading.
    4. Data Entry: Input details regarding goods movements and challan information.
    5. Finalization: Preview the form for accuracy before submission.
  • Filing through Tally ERP 9:

    1. Prepare Data: Utilize Tally’s comprehensive GST features to organize and maintain records of goods sent to or received from job workers.
    2. Generate ITC-04 JSON: Tally ERP 9 allows for the direct generation of the ITC-04 JSON file based on the recorded transactions.
    3. Upload to GST Portal: Log in to the GST portal to upload the JSON file generated by Tally, reviewing it for any discrepancies before final submission.

Compliance Timelines and Penalties

  • Due Date: ITC-04 must be filed quarterly, by the 25th day of the month succeeding a quarter. For instance, for the July-September quarter, the due date is October 25th.
  • Penalties for Non-Compliance:
    • Late Filing: A late fee of Rs. 100 per day (up to a maximum of Rs. 5,000) is charged for delayed submissions.
    • Incorrect Details: Submitting inaccurate information can lead to penalties under GST laws, including potential interest on misused credits and tax discrepancies.

At a Glance: Compliance Overview

PurposeTransparency in goods movement for job work
SectionsGoods Dispatched/Received, Challan Details
Filing MethodsDirect on GST Portal or via Tally ERP 9
Compliance DeadlinesQuarterly, by the 25th of the month following a quarter
PenaltiesLate fee of Rs. 100 per day, Maximum Rs. 5,000


Comprehensively managing ITC-04 filings is pivotal for entities engaged in job work, ensuring proper input tax credit utilization and adherence to GST mandates. By leveraging platforms like Tally ERP 9 for record-keeping and form generation, businesses can streamline their compliance process. Prompt and accurate filing, along with diligent record maintenance, is crucial to avoid penalties and optimize tax benefits under the GST regime.