you can take ITC of the GST amount paid on the purchase of computer . But, in case ITC is taken then depreciation is not available on this GST amount.
Can I claim ITC for a computer purchased, which I am using in my office, for my business
I bought a computer on my Company Name with my Company's GST Number. I sell room bookings and pay 12% GST and also sell merchandise like stickers, cups, t-shirts, etc for which I pay 18% GST to the Government. But, my CA says that , ITC should not be claimed by me, expect for the purchase of the merchandise. Is that correct ?
Asked 2 years ago in Taxation
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6 Answers
Yes you can claim the same
- As per law, a registered person , including an Input Service Distributor can claim ITC .
- Since, you bought the computer on your company name with GST number , then you cannot claim the same
- The suggestion of CA is correct .
Dear Client
GST Rate: The GST rate applicable to your purchases must match the GST rate applicable to your sales. In your case, it appears that you have two different GST rates: 12% for room bookings and 18% for merchandise.
Business Purpose: To claim ITC, the purchases must be made for the purpose of furthering your business. If you purchased the computer for your business activities, you may generally be eligible to claim ITC for the GST paid on it.
Documentary Requirements: Proper documentation, including valid GST invoices and receipts, is essential for claiming ITC. Ensure that you have all the necessary documents in order.
Compliance with GST Laws: Your business must be in compliance with GST laws, including filing GST returns on time and fulfilling other statutory obligations.
Restrictions and Blocked Credits: Some categories of goods and services are subject to restrictions or are considered blocked credits under GST law. These credits cannot be claimed as ITC. It's possible that your CA may be referring to certain items that fall under this category.
Consultation with a Tax Professional: Since GST laws and regulations can be complex and can vary by jurisdiction, it's highly advisable to consult with a qualified tax professional or GST expert who can provide specific advice based on your business and its unique circumstances.
Legal Remedies:
If you believe your CA's advice is incorrect or if you feel that you are entitled to claim ITC based on the GST laws applicable to your situation, you may consider the following legal remedies:
Seek a Second Opinion: Consult with another tax professional or GST expert to get a second opinion on your eligibility to claim ITC.
Review GST Laws: Review the GST laws and regulations applicable to your jurisdiction to understand the specific conditions and restrictions regarding ITC.
Appeal or Dispute Resolution: If you believe you have a legitimate case, you may consider appealing the CA's decision or engaging in dispute resolution procedures as per the relevant tax authority's guidelines.
Legal Action: In extreme cases, you may need to consider legal action if you believe your rights under GST laws are being violated.
Input Tax Credit (ITC) can be claimed on the purchase of a computer/laptop if the laptop is used for making taxable supplies and the purchaser is registered for GST in India.
As a matter of fact you can claim both the things i.e itc and depreciation but you can claim full depreciation if you purchased your computer/laptop before completion of first 6 months of this financial year otherwise you are only eligible to claim half of the depreciation.
- Input tax credit (ITC) is the GST paid by a taxable person on any purchase of goods and/or services that are used or will be used for business purposes.
- ITC can be claimed on the purchase of a computer if it is used for making taxable supplies and the purchaser is registered for GST in India.
- To claim ITC on the purchase of a computer, the purchaser must hold the tax invoice or debit note or document evidencing payment, file it in Form GSTR-1, and it must appear in Form GSTR-2B.
- However, if ITC is taken, then depreciation is not available on the GST amount. If the computer is used for personal purposes or for capital goods used in exempted sales, then ITC is not available.
