Input tax credit on hotel accomodation

This query is : Resolved

Abhiz (Querist)
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01 March 2018 Hi,

My employee use to stay in a hotel for business purpose so Can i take input tax credit against tax paid for HOTEL ACCOMODATION ???

CA Ashish Agrawal

CA Ashish Agrawal (Expert)
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01 March 2018 Yes, you can take credit, but make sure that you have given your GSTIN to the Accommodation service provider.

Abhiz

Abhiz (Querist)
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01 March 2018 ok. But what is the treatment if the bill includes food expense???

CA Ashish Agrawal

CA Ashish Agrawal (Expert)
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01 March 2018 Look GST on restaurant service is chargeable @ 5%, provided it is not a starred hotel. Your bill might be having two components i.e. Accommodation and restaurant charges, so you book the expenses and GST accordingly.

Abhiz

Abhiz (Querist)
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01 March 2018 So, ITC available for room tariff and
ITC will not be availbale for restaurant services as it will come under food and bevereages.

CA Ashish Agrawal

CA Ashish Agrawal (Expert)
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01 March 2018 No, ITC is available for both i.e. accomodation and food.

Abhiz

Abhiz (Querist)
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03 March 2018 as per sub-section (5) of section 17 of CGST Act, 2017 Availing Supply of food and beverages will come under blocked credits
Please see this link
https://www.caclubindia.com/articles/-input-supply-on-which-itc-is-not-available-blocked-credit-32057.asp

CA Ashish Agrawal

CA Ashish Agrawal (Expert)
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03 March 2018 Yes, you are right, ITC on Food can-not be availed. I forgot that 5% is under mandatory composition scheme.

Abhiz

Abhiz (Querist)
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03 March 2018 So i can take ITC on room tariff only.

Thank You Ashish :-)

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