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ITC CLAIM ON CAPITAL GOODS IN ITC-01

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This query is : Resolved

Quick Summary

ITC on capital goods in Form GST ITC-01 is allowed only in specific cases such as switching from composition to regular scheme or when exempt supplies become taxable. Credit is reduced by 5% per quarter from invoice date. It is not allowed for fresh or voluntary registration.

mahi devta

mahi devta (Querist)

28 May 2026 ITC CLAIM ON CAPITAL GOODS IN ITC -01 ELIGIBLE OR NOT?

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

29 May 2026 Whether ITC on capital goods can be claimed in Form GST ITC-01 depends entirely on the registration type. It is ineligible for brand-new or voluntary registrations under Sections 18(1)(a) and 18(1)(b). However, it is eligible if you are migrating from the composition scheme to the regular scheme [Sec 18(1)(c)] or if your exempt business has become taxable [Sec 18(1)(d)], provided the credit amount is reduced by 5% per quarter from the invoice date.

mahi devta

mahi devta (Querist)

29 May 2026 thanks sir ji for your advise

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