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What is all about the Input Service Distributor in GST?

GST registration
March 28, 2019

What is all about the Input Service Distributor in GST?

Goods and Services Tax is in reality a great economic change that is speedily driving the country towards the way of brilliance. The GST law incorporates different arrangements for that are important to different sorts of transporters and brokers having GST registration.

  • Until this point, the GST routine has really rearranged the area of indirect tax. Different regions of the customary course of business have been legitimately secured and clarified under the GST law. Subsequently, GST has improved the general simplicity of working together.


  • The GST Act has explicit arrangements in regards to GST registration and GST return filing for various sorts of business activities. One such vital angle secured under the GST law is Input Service Distributor.

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#1. What do we mean by an Input Service Distributor?

An Input Service Distributor or ISD in general means an office of a provider of goods or services that acknowledges the tax credits for the receipt of input services. The CGST Act has discussed the context of the Input Service Distributor in full detail.

  • The ISD at that point issues an authorized record for appropriation of the CGST, SGST or UTGST and IGST input credits.
  • On the off chance that an association has different branches crosswise over various states in India, at that point the head office will assume the job of an ISD. He will circulate the input credits to his providers of taxable goods/services situated in various states.
  • For this situation, the providers of taxable goods/services will have same PAN that the ISD is having.

#2. How is the idea of ISD discussed under GST?

Fundamentally the idea of ISD is prevalent since service tax era. It has been extended to GST era.

  • At the present time, it is usually observed that generally the corporate office acquires different goods and services from its units situated in various states in India. Such inputs are assembled by every one of the units of an association.
  • Presently, in such case the buy request is raised by the head office, while the providers issue GST receipt for the sake of the head office.
  • Here, the head office itself can’t use the GST Input Credit on such services. This is on the grounds that the Head office itself isn’t giving any yield supply.
  • Thus, he will presently act as the Input Service Distributor or ISD and will appropriate the individual Input Credits relating to every one of its providers having separate GST registration in various states.
  • The idea of ISD has been represented u/s 20 of CGST Act 2017.


#3. By what method can this concept be cleared?

This can be practically comprehended by help of a contextual case. This is given below-

  • A will be a factory, whose branch workplaces are situated in various states state, UP, Bihar and Bengal.
  • The branches of give services of production, for example, assembling, manufacturing, processing and so on to their clients.
  • Presently, since all the diverse units are having separate GSTINs, A can’t take the input credit as it has not provided any of the services to the clients.
  • Thus, A should disperse IGST, CGST and SGST input tax credit to the branches in various areas.

#4. What are the guidelines with respect to GST return filing for ISD?

An ISD is required to take GST registration as an Input Service Distributor. They are required to follow a different GST return filing system with FORM GSTR-6. This return must be furnished till 13th of each month.

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