Overview

GSTR-6 is the monthly GST return filed by an Input Service Distributor (ISD). An ISD is a GST registration used by businesses that receive input service invoices at a central office and distribute the eligible Input Tax Credit (ITC) to their branch GSTINs or recipient units.

For example, a head office may receive invoices for common services such as software, consulting, rent, audit fees, or other shared business services. Instead of claiming the full ITC in one GSTIN, the ISD distributes the credit to the eligible recipient GSTINs as per GST rules. GSTR-6 is used to report the ITC received by the ISD and the ITC distributed to each recipient GSTIN.

Octa GST helps businesses manage ISD GST compliance by bringing together GSTR-6A data, ISD purchase register reconciliation, ITC claim, turnover-based distribution, and GSTR-6 return preparation in one workflow.

Use the GSTR-6 workflow in Octa GST to distribute Input Tax Credit (ITC) from an Input Service Distributor (ISD) GSTIN to the recipient GSTINs under the same organization.

At a high level, the process is:

1. Add the ISD GSTIN in Octa with registration type ISD.
2. Add the recipient GSTINs and enter their turnover details.
3. Fetch GSTR-6A data from the GST portal or import it through the available options.
4. Import the ISD purchase register for reconciliation.
5. Reconcile the purchase register with GSTR-6A.
6. Claim the eligible ITC that should be distributed.
7. Run Auto Distribution to distribute ITC to the recipients.
8. Review the prepared GSTR-6 data and push it to the GST portal.

The recipient turnover is used to calculate the distribution ratio. Once the purchase data, GSTR-6A data, ITC claim, and recipient details are ready, Octa can prepare the distribution entries and help you file GSTR-6 with fewer manual calculations.