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ITC claim on fixed assets ?

Mohit Rathore (4 Points)

26 January 2022

If I take ITC on fixed assets so I can not take depreciation claim on fixed assets ?

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9 Replies

prasad Nilugal ( GST Practitioner & Accounts ) (14882 Points)
Replied 26 January 2022

Yes, as per section 16(3) of the CGST act , where the registered person has claimed depreciation on the tax components of the cost of capital goods and plants and machinery under the provisions of the Income tax act 1961 , then the input tax credit on the said tax components shall not be allowed .

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sabyasachi mukherjee (27762 Points)
Replied 27 January 2022

This insertion is being made to negate double credit on fixed assets.

CA Altamush Zafar (GST Consultant) (15986 Points)
Replied 27 January 2022

If you take ITC on fixed assets then you cannot claim depreciation on tax amount. Depreciation will still be available on amount of fixed asset excluding GST amount

Nidhi (Chief Accountant) (3150 Points)
Replied 28 January 2022

If You take ITC on fixed assets, than Depreciation is available on amount excluding GST.
If you don't take ITC, than Depreciation is available on full invoice value(i.e incl. GST)

Aarti Maurya (Student) (3273 Points)
Replied 29 January 2022

yes , as per sec 16 of cgst act if you claim ITC on capital goods you cannot claim depreciation.

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CA Naveen Chand (Chartered Accountant) (12739 Points)
Replied 29 January 2022

either ITC or depreciation .

Nidhi (Chief Accountant) (3150 Points)
Replied 29 January 2022

It's not either ITC or depreciation.

If You take ITC on fixed assets, than Depreciation is available on amount excluding GST.
If you don't take ITC, than Depreciation is available on full invoice value(i.e incl. GST)

So, Depreciation is available on both case, but amount on which depreciation available will change

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