83% firms fail to optimise ITC claims

Close to 83 per cent of enterprises have not been able to optimise Input Tax Credit (ITC) claims correctly, as per a survey conducted by ClearTax.

The survey was aimed at finding the pain points of availing input tax credit without any delay. The findings are based on a survey that sampled 1,200 enterprises across the country and also past proprietary research conducted by ClearTax. It is a strong indicator of the pain points in optimising ITC claims and filing GST returns that are affecting profitability in a significant way.

These trends have affected large enterprises significantly. A multinational company faced a total loss of Rs 850 crores due to suboptimal ITC management. This includes Rs 50 crores of ITC not filed and Rs 800 crores of interest loss on delayed filing by vendors, the ClearTax survey noted.

Another lifestyle company registered a total loss of about Rs200 crores due to ITC mismanagement. This includes Rs30 crores of ITC not filed and Rs170 crores of interest loss on delayed filing by vendors. Mid-sized enterprises also faced similar issues. Based on ClearTax analysis, this varies between Rs15 crores and Rs20 crores.

The study says that almost a third of companies find the process of ITC claims extremely laborious and cumbersome.