ITC on employee insurance

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CA Article Trainee
84 Points Posted on 25 April 2020
Can a employer take ITC on Employee Compensation Insurance policy ?
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On 25 April 2020 at 13:07 Report
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Quick Summary
Generally, employers cannot claim Input Tax Credit (ITC) on employee compensation insurance as it's often considered a blocked credit. However, there's an exception: if the insurance is made mandatory for employers by law, then ITC can be availed. This hinges on government notification classifying such insurance as an obligatory service.

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CA in Practice
241 Points Posted on 25 April 2020
Can be claimed as itc only when the Government notifies it as services which are obligatory for an employer to provide to its employees under law.
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On 25 April 2020 at 13:21
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Chartered Accountant
12739 Points Posted on 25 April 2020

Generally, NO = Blocked credits Sec 17(5) 

BUT 

if such insurance is obligatory for the employer under any act for the time being in force then ITC CAN BE AVAILED . 

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On 25 April 2020 at 19:17

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