ITC on car buying

Hi,

As per section 17(5) of CGST Act, input tax credit will not be available in respect of motor vehicles and other conveyances, except when:

such motor vehicles or other conveyances are supplied further, or

used for transportation of passengers or giving training on driving, flying, navigating such vehicles or conveyances or

are used for transportation of goods.

Hence, if your firm does a business that falls under any of the categories mentioned above, it can claim the input tax credit.

Remember, both input tax credit of GST paid on purchase of such capital goods and depreciation u/s Income Tax Act 1961 will not be allowed together. You can either claim input tax credit of GST, or depreciation u/s Income Tax Act 1961.

Dear Sir,

Hope you are doing well !

Generally the answer is No, the gst credit paid on purchase of car cannot be claimed, unless you are in the business of buying selling cars and/or travel business.

Gst on Tempos trucks etc purchased for transport of products can be claimed but i don't think that is what you planned on asking so generally GST credit on purchase of car by a firm cannot be claimed !

Thanks & Regards,

Payal Chhajed

Hi Bikramjit,

No you can't buy a car with the benefits of ITC. You can add GST in the cost of car and cla depreciation on it.

Hope that helps

Hi,

No you can't take ITC benefit on purchase of car due to restrictions posed by section 17(5).

You can add it in the cost of car and claim depreciation on the same.

No you can't buy a car with the benefits of ITC.

ITC is available on cars only to person's doing following business:

a) Supply of other vehicles or conveyances

b) Transportation of passengers

c) Imparting training on driving, flying, navigating such vehicle or conveyances

d) Transportation of goods

I don't think event management service will be included here and therefore I don't think you will get ITC on car purchase.

Even if you don't get ITC you can claim depreciation on such GST part also. So you are not incurring a loss.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

If you can show that this car is exclusively used to carry goods, tools and equipment used for advertising or event than you can claim ITC of it

hi

Car used for business purpose then itc can be claimed

Hi,

- ITC on car is available only in the following cases.

- Car dealer

- Car driving training

- Transportation of Passengers.

- Transportation of goods

In your case it will be treated as Cost of asset only.

Thanks