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Input tax credit on rent to rent
A proprietorship firm run a business of exempted goods registered under GST and for the business shop(Rental property- not owned property) he pay monthly rent to the landlord and for the same he had paid RCM under GST. Further, he owned commercial property and the same was let-out and received rent by giving GST invoice to the tenant. Now my question is can he avail the GST paid under RCM in business shop dealing exempted goods as input tax credit towards discharging tax liability on commercial property let-out to the tenant.?
Replies (1)
As per Section 17(2) of the CGST Act, ITC is not available for supplies of exempt goods or services. Since the proprietorship firm deals in exempted goods, the GST paid under RCM on rental for the business shop cannot be availed as ITC towards discharging tax liability on the commercial property let-out.
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