GST ITC on hospital rent

A hospital (Pvt.Ltd.) paid GST on rent  can claim ITC in following situation;

1. if pharmacy owned by the hospital.

2. if pharmacy outsourced by them.

also suggest weather it is beneficial to run own pharmacy coz company taxed @ 25% and individual taxed @ 30% after 10Lakhs of income.

 

Replies (3)
Quick Summary
This discussion explores whether a private limited hospital can claim Goods and Services Tax (GST) Input Tax Credit (ITC) on rent payments. It examines scenarios involving owned versus outsourced pharmacies and the tax implications for the hospital. The core issue is that GST paid on rent is often non-set-offable against output tax, as medical services are typically exempt from GST, preventing ITC claims and refunds.

As a result payment of GST on rent of the premises remains non set-off against output tax i.e., ITC cannot be availed due to nil tax payable under GST law on supply of medical services to the patients. That there is no provision to get refund of ITC to the extent of GST paid/payable on the rent of the premises.

Sir,

if we run own pharmacy then there will be tax payable situation.

in that case, can we claim ITC ?

ITC can be availed only on goods and services for business purposes. 

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