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Input tax credit

13 June 2018

A pvt. limited company incurs lot of expenses in which it's paid Gst.What is the criteria to get input tax credit benefit in which it's paid gst in expenses.

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(Guest)

If those expenses are for the purpose of business of that company so it will be called input or input services for that business so you can take the credit and pass the entry of expense along with input tax in the books . But credit will be available subject to the conditions of sec 16 and 17(5) of CGST Act. If expenses are falling within section 17(5) so credit will not be available

CA Naveen Chand (Chartered Accountant) (12729 Points)
Replied 13 June 2018

READ SECTION 17(5)

c jyothi (Student CA IPC / IPCC) (103 Points)
Replied 13 June 2018

It depends on provision of sec 16 and 17(5) of cgst and what is the pvt company business whether it is export of services are only inter and inter state supplies
If export oriented the chance is there for getting refund if company is registered
Other wise it added to the cost itself of supplies

avinash kumar (21 Points)
Replied 13 June 2018

it's a educational institutions

c jyothi (Student CA IPC / IPCC) (103 Points)
Replied 13 June 2018

So it's form part of cost because no ITC allowed for tax on input supplies used for supplying exempted supplies because of restriction in section 17
So ITC on inward supply must be charged to statement of profit for respective period.