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Credit on insurance premium

yash (accountant) (519 Points)

02 July 2020

I am manufacturer and i paid the insurance premium. now i got the insurance bill of different policy of car insurance/fire insurance/ staff bus insurance/ building insurance etc.

now, am i eligible to take the ITC for the same.

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8 Replies

CA Sunil Kumar (Chartered Accountant) (4514 Points)
Replied 02 July 2020

ITC blocked u/s 17(5)
1. Car insurance
2. Staff bus insurance if seating capacity is less than or equal to 13 (including driver)
ITC Allowed
1. fire insurance
2. Building insurance

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CA Akshay Hiregange (Partner - Audit & Assistance) (4515 Points)
Replied 02 July 2020

Yes agree with Sunil Kumar, also insurance on gratuity, liability insurance, stock insurance are eligible where related to business function.

yash (accountant) (519 Points)
Replied 02 July 2020

THANKS @ CA Sunil Kumar

yash (accountant) (519 Points)
Replied 02 July 2020

And if staff bus having capacity more than 13 persons then?

CA Akshay Hiregange (Partner - Audit & Assistance) (4515 Points)
Replied 02 July 2020

ITC is Eligible u/s 17(5)(aa).

1 Like

Pankaj Rawat (GST Practitioner) (55032 Points)
Replied 03 July 2020

But in my view Insurance on Building can be claimed.

1. Goods or services reced by taxable person for CONSTRUCTION of Immovable property blocked

Insurance of building can never be treated as construction activities & as per Explanation the Construction include reconstruction, renovation, addition or alteration,or repair to the extend of capitalisation to Immovable property.
And also I do not capitalise the insurance expense to building Account.

So in my view the ITC can be claimed on insurance of building.

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