Goods purchased and input available

This query is : Resolved

Quick Summary

You can generally adjust the GST on commission income (output GST) against the GST paid on iron goods (input GST) in a proprietorship firm. This is possible if the iron goods are used for your business, you have a valid tax invoice, and the supplier has paid the GST. Proprietorships are treated as a single entity for GST purposes, making this adjustment straightforward under normal circumstances.

ARUN GUPTA

ARUN GUPTA (Querist)
Follow

26 March 2025 Can I adjust commission output gst with goods input gst of iron goods in a proprietorship firm ? Please clarify?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

26 March 2025 Whether the commission business is in relation to the goods trading or separate one.

ARUN GUPTA

ARUN GUPTA (Querist)
Follow

26 March 2025 Commission will be received for iron goods

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

26 March 2025 Yes, eligible for same line of business.

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
Follow

28 March 2025 Yes, you can adjust or set off the GST liability on commission (output GST) with the input GST paid on iron goods in a proprietorship firm, provided certain conditions are fulfilled:

✅ Conditions for Set-Off (Input Tax Credit Eligibility):
Goods are used for business - The iron goods should be used or intended to be used in the course or furtherance of business.

Tax Invoice Available - You must have a valid tax invoice or other prescribed document.

Supplier GST Compliant - Supplier should have uploaded the invoice in GSTR-1 and paid tax.

GST Paid on Inputs - GST must have been actually paid to the supplier.

Blocked Credit Not Applicable - Iron goods must not fall under the blocked credit list under Section 17(5) of the CGST Act.

Proprietorship Status - GST law treats proprietorship as a single entity, so output GST on commission and input GST on iron goods are part of the same GST registration.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now