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ITC on Capital Goods

23 January 2019

If Company deal only in taxable supply, if machinery purchased then how itc is available.

whether all itc available in the year of purchase or over the life of 5 year ??

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7 Replies

CA CS Chirag (Practicing CA) (834 Points)
Replied 23 January 2019

GST paid on capital goods can be claimed as credit in the same way as inputs. However, if you claim depreciation on the GST paid while purchasing the capital asset, you cannot claim input tax credit.

1 Like

vinod lohar (20 Points)
Replied 23 January 2019

Normally cost of capital goods is High and tax credit also high, did you mean whatever amount of ITC can be claimed in the year of purchase only irrespective of amount involved in ITC. Am I right

Sanjiv Rajpoot (3430 Points)
Replied 23 January 2019

agree with ca chirag sir

3 Like

RAJA P M ("Do the Right Thing...!!!") (127167 Points)
Replied 23 January 2019

@ Mr Vinod lohar.,

You can claim ITC in single take at the time of Purchase of CG. No more restrictions as You said that 5years calculation.

Vinod Babu (24191 Points)
Replied 24 January 2019

ITC can be fully claimed in one shot...

vinod lohar (20 Points)
Replied 24 January 2019

Thank you so much

santosh kumar gupta (MANAGER FINANCE & ACCOUNT IN ISHAAN INFRAESTATES INDIA PVT LTD VASUNDHARA GHAZIABAD) (63 Points)
Replied 01 February 2019

When you purchase anything, you are required to pay GST on it. Later, you can claim input tax credit on the GST paid on your purchases. SImilarly, when you are purchasing any machinery for your factory, you will pay the applicable GST rate. This GST paid can be claimed as credit in the same way as inputs.

However, if you claim depreciation on the GST paid while purchasing the capital asset, you cannot claim input tax credit