Input Tax Credit on RCM Paid for Transportation of Gifts

Dear Experts,

Company A purchases gifts to distribute to its dealers during festive occasions. The GST paid on the procurement of these gifts is not eligible for input tax credit (ITC), as they are considered gifts under GST law.

However, for transporting these gifts from one location to another, the company hires a transporter and pays GST under the Reverse Charge Mechanism (RCM).

My question is: Can Company A claim ITC on the GST paid under RCM for the transportation of these gifts, even though the gifts themselves are ineligible for ITC?

Regards,
S Ram

Replies (2)
Quick Summary
This discussion clarifies whether a company can claim Input Tax Credit (ITC) on GST paid under the Reverse Charge Mechanism (RCM) for the transportation of gifts. Although the gifts themselves are ineligible for ITC, the transportation service is considered a separate input service. Therefore, the company can indeed claim ITC on the GST paid for the transportation of these gifts.

Yes.. Company A can claim ITC on the GST paid under RCM for the transporttion of gifts, as transportation services are a separate input service eligible for ITC.

Dear Rama-sir,

Thanks for your reply.

 

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
08 October 2026
SALES TELECALLER

HIRE NOVA

Lucknow

Graduate (Any)

View Details
Company
ARTICLESHIP 16 September 2026
CA Article Trainee

SR BAGAI & Co.

New Delhi

CA Inter

View Details
Company
12 October 2026
Finance

I-Genext Consulting Private Limited

New Delhi

CA

View Details
Company
30 September 2026
Senior Accounts Executive

Codeboard Technology

Chennai

MBA

View Details
Company
Featured ARTICLESHIP 06 October 2026
Semi Qualified

AJAY SINGH AND CO LLP

Thane

CA Final

View Details
Company
26 September 2026
Chartered Accountant

pushpganga ventures

Pune

CA

View Details
Company
15 September 2026
Client-site CA associate

Aditya Muley and Co

Mumbai

CA

View Details
Company
05 October 2026
Senior Accountant

Vision IT Peripherals Pvt Ltd

Mumbai

B.Com

View Details