Clarification on GST Liability and ITC Availability for Warranty/Extended Warranty

Last updated: 27 June 2024

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This notification provides further clarification on the Goods and Services Tax (GST) liability and the availability of Input Tax Credit (ITC) concerning warranty and extended warranty services. It builds upon previous guidance issued in Circular No. 195/07/2023-GST. The aim is to ensure consistent application of GST laws across all tax authorities.

F. No. CBIC-20001/4/2024-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
*****

North Block, New Delhi
Dated the 26th June, 2024

To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/ Commissioners of Central Tax (All)
The Principal Directors General/ Directors General (All)

Madam/Sir,

Subject: Clarification in respect of GST liability and input tax credit (ITC) availability in cases involving Warranty/ Extended Warranty, in furtherance to Circular No. 195/07/2023-GST dated 17.07.2023-reg.

Reference is invited to Circular No. 195/07/2023-GST dated 17.07.2023 (herein after referred to as “the said circular”) clarifying certain issues regarding GST liability and availability of input tax credit (ITC) in respect of warranty replacement of parts and repair services during warranty period. Representations have been received from trade and industry requesting for some further clarifications in related matters.

2. In order to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods & Services Tax Act, 2017 (herein after referred to as the “CGST Act”), hereby clarifies the following issues as below.

For full notification please refer to the attachment.

FAQ :

This notification aims to provide further clarifications on GST liability and Input Tax Credit (ITC) availability for warranty and extended warranty services, ensuring uniformity in implementation.

This notification refers to Circular No. 195/07/2023-GST dated 17.07.2023, which previously clarified issues regarding GST liability and ITC for warranty replacement parts and repair services.

The clarification was issued in response to representations received from trade and industry seeking further guidance on matters related to GST on warranties.

This notification is addressed to the Principal Chief Commissioners, Chief Commissioners, Principal Commissioners, Commissioners of Central Tax, and Principal Directors General, Directors General.

The notification clarifies issues regarding GST liability and the availability of input tax credit (ITC) in cases involving warranty and extended warranty.