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GST Rate on buyback of Leased CAR

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Yogesh

sse

33 Points Posted on 28 June 2022

I had CAR lease from Tata capital. When the CAR was originally purchased in 2018 the GST charged was 28% + 17% Cess. Now after completion of 4 Years the residual value of CAR is 15% of Exshowroom price. I need to pay this amount to TATA capital, they are charging 28% GST + 17% CESS on residual value of CAR. I searched on various websites and found that the GST on 2nd hand car sale is 18% + CESS. But Tata is claiming that since the original Invoice has 28% GST and 17% CESS they will follow same. GST experts can better provide the correct way to apply GST on used car. Your comments are appreciated.

Replies (3)

Quick Summary

This discussion addresses the correct Goods and Services Tax (GST) rate applicable when buying back a leased car. The original poster was charged 28% GST plus 17% cess on the residual value, but believes the rate for second-hand cars (18% GST, no cess) should apply. Experts are sought to clarify the correct GST treatment for used car buybacks from leasing companies.