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Input credit GST on Purchase of Car

Subramanyam (Accountant) (221 Points)

29 January 2018

Dear Sir /Madam,
we are partnership firm as well as we are taking input on Purchase of Raw matireal.

My query is .
recently My MD was bought New car in The company Name car invoice saying GST out .
here shall we take input claims and remain to be Paid GST portal ?

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10 Replies

srinivas b k (assistent accountent) (35 Points)
Replied 29 January 2018

you will purchase the only purpose of company or not

srinivas b k (assistent accountent) (35 Points)
Replied 29 January 2018

you will purchase the car only for the purpose of company or not

manjunatha natha (3 Points)
Replied 29 January 2018

input credit can take If car is using for providing out service

examples: car using for transportation (driving school)

I thought MD purchased car for personal use, if anything purchased for personal use for that we can take input tax credit

Subramanyam (Accountant) (221 Points)
Replied 29 January 2018

1) Incase of Employee's Transport ie pick up and Drop for office.
2) Incase of Car was purchased for using MD personal / ofcourse the above inv's in the name of company only ....
* Shall we take in put of GST ?
* if Yes how to Pass an entry in Tally software ?

RAJA P M ("Do the Right Thing...!!!") (127245 Points)
Replied 29 January 2018

No..... ITC not available...

VRS Rana (CA article) (24 Points)
Replied 30 January 2018

If the invoice is in the name of entity, you can take credit accordingly. And the entry will be
Car - Dr
Gst (cgst/sgst/igst)- Dr
party- Cr

RAJA P M ("Do the Right Thing...!!!") (127245 Points)
Replied 30 January 2018

Originally posted by : VRS Rana
	If the invoice is in the name of entity, you can take credit accordingly. And the entry will be Car - DrGst (cgst/sgst/igst)- Drparty- Cr

You really....!!!

Is ITC available for above query...?

If YES... Please elaborate this availability...

VRS Rana (CA article) (24 Points)
Replied 30 January 2018

according to GST credit rules , credit can be availed on business or non business activities
Note- This is as per GST act but when we proceed with income tax act then we will not be able to take depreciation on tax included in capital goods.

Mukund (-) (2 Points)
Replied 01 February 2018

as per 17(5) blocked credits, no ITC is available with respect to the purchase of car unless the company similar outward supply. Like in the business of sale or purchase of car...or transportation of passenger or goods

Arvind Baluni (AGM - A&F) (29 Points)
Replied 15 November 2018

After going through the above provisions, one can easily conclude that, the input tax credit of inward vehicles and other expenses as incurred in relation to the vehicles cannot be denied under following circumstances;

Input tax credit cannot be denied in case the motor vehicles are being used by the business entities for transport of its raw-material, semi-finished goods, final produce and/or capital goods like plant & machinery, spares, stores and/or fuel; and
Input tax credit even cannot be denied in the case where the business entities use the vehicle for transport of its staff or workers on chargeable basis.