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ITC on Car Purchage

Gopala Krishna (285 Points)

09 January 2024

Purchased on Firm Name. Shall We Claim ITC

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Amit Kumar (Tax Professional ) (112 Points)
Replied 09 January 2024

Only if your firm provides rent a cab service

David (article Assistant) (1621 Points)
Replied 09 January 2024

The ITC on motor vehicle under GST is available if such motor vehicles use for making the following taxable supplies. However, there are certain conditions:

• Input Tax Credit (ITC) is admissible for motor vehicles which use or intend to use for transportation of goods

• Moreover, ITC shall be allowable for passenger transport vehicles. These are approve seating capacity of more than 13 persons (including driver). In addition, there is no such restriction on ITC in this respect.

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Amit Kumar (Tax Professional ) (112 Points)
Replied 10 January 2024

Section 17 (5):
Notwithstanding anything contained in sub-section (1) of section 16 and sub- section (1) of section 18, input tax credit shall not be available in respect of the following, namely:—
[(a) motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely:—
(A) further supply of such motor vehicles; or
(B) transportation of passengers; or
(C) imparting training on driving such motor vehicles;