Relating to capital asset
This query is : Resolved
16 May 2020
Dear All,
Please kindly suggest your views relating to Input Tax credit in Asset Accounting:-
As per notification of the govt. After purchasing a Capital Asset, if we avail depreciation against it under Income Tax Act, ITC in GST is totally disallowed.
And then after certain year of use if we sale the asset we need to charge GST as a regular gst tax payer.
The resultant effect is that it is better to pay the GST without availing any credit just to avoid unnecessary notices & show cause orders from department. (Keeping in view of availing depreciation during certain year of use)
Please kindly suggest your views relating to Input Tax credit in Asset Accounting:-
As per notification of the govt. After purchasing a Capital Asset, if we avail depreciation against it under Income Tax Act, ITC in GST is totally disallowed.
And then after certain year of use if we sale the asset we need to charge GST as a regular gst tax payer.
The resultant effect is that it is better to pay the GST without availing any credit just to avoid unnecessary notices & show cause orders from department. (Keeping in view of availing depreciation during certain year of use)
17 May 2020
If you avail ITC on Capital Goods (which are allowable), you should not claim depreciation on the ITC amount. You should claim depreciation on the amount other than ITC i.e. the amount before charging GST.
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17 May 2020
Thank you sir I got it.
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