top of page
Search
  • Dhruv Seth

Input Tax Credit wrongly availed under GST


Input Tax Credit mechanism allows registered person under GST to set-off their GST tax liability. Since GST is a consumption-based tax, the input tax credit mechanism ensures that the ultimate GST liability is passed on to the consumer. Though GST is very famous for the free flow of credit, there are few cases where input tax credit is not available to the taxpayer under GST regime. Some of them are mentioned below:

 Goods or Services or both used for personal consumption.  Goods lost, stolen, destroyed, written off or disposed of by way of gift or free sample.  Goods or services procured from composition dealers.  No ITC will be allowed of tax component paid on purchase of capital goods if depreciation has been claimed on the same.  ITC on hotel bills if the State in which the buyer is registered is different than the state in which the hotel is located.  ITC on Motor vehicles and other conveyances except when they are used-- · Further Supply of such vehicle or conveyance; or · Transportation of passengers; or · Imparting training on driving, flying, navigating such vehicle or conveyances; or · Transportation of goods  Food and Beverages, Outdoor Catering, Beauty Treatment, Health services, cosmetic and Plastic surgery except where an inward supply of goods or services or both of the particular category is used by a registered person for making an outward taxable supply of the same category.  Rent-a-cab service except in cases- · Where govt. notifies the services are obligatory. · For making an outward taxable supply of same category of goods or services.  ITC is not allowed in case of service providers who have opted for lower rate of tax. For instance - Restaurant Service, Passenger & Goods Transport Service, GTA, etc.


30 views0 comments

Recent Posts

See All

As we all know that Statutory Audit for the FY 2021-22 has been completed and the books of the account has been finalized and audited by the Auditors. So, here is an important checklist for all the ta

1. Directions by Supreme Court The Supreme Court has directed the GSTN to open the portal and allow filing or revising transitional forms during the period from 1st October’2022 to 30th November’2

CHARGE OF EQUALISATION LEVY ➢ Rate: 6 % of the amount of consideration received or receivable. ➢ Service Provider: Any non-resident person ➢ Service Receiver: ▪ A person residen

bottom of page