as per ITC claiming rules
ITC not allowed if we take depreciation on that asset
my doubt is
I purchased 100000 +18% gst
machinery
and I will show it as asset in my books and at the end of the year as per company act we need to charge depreciation on that
if I took 18% itc , can't I charge depreciation on year end .
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ITC on capital goods
Replies (1)
You cannot claim both ITC and depreciation on the GST component of capital goods. Per Section 16(3) of the CGST Act, if you claim depreciation on the tax portion of an asset under the Income Tax Act, you forfeit the right to claim ITC on that same tax amount. To maximize your benefits, it is generally advised to claim the ITC upfront (if you have sufficient output tax liability) and depreciate only the net (pre-tax) cost of the asset.
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