Gst on royalty charged by restaurant chain

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A FAMOUS CHAIN OF RESTAURANT IS GIVING FRANCHISE. IT COLLECTS A ONE TIME FRANCHISEE FEES AND ROYALTY (FIXED OR TURNOVER BASED) FROM THE FRANCHISEE ON WHICH GST IS CHARGED.

STAND ALONE RESTAURANTS ARE NOW REQUIRED TO CHARGE GST @ 5% HOWEVER THEY CAN NOT AVAIL ITC.

ON ROYALTY HOWEVER THE RATE OF GST IS 18%. IN THIS CASE WILL ITC BE AVAILABLE??? IF YES HOW??

 

Replies (2)
no ITC for restaurants
No you cannot claim (As per Noti.46)

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