29 December 2017
Does interior designers come under works contract service?if so can he claim input tax credit on purchased material he used for such designing?
30 December 2017
In case construction renovation etc. of immovable property is also involved along-with designing and consultancy it is works contract. Further credit of materials may be claimed used for providing such service may be claimed.
03 January 2018
Sir if i want to claim input of gst paid for restaurant bills(business expenditure),should i enter such details in GSTR-2 after filling the amount details in GSTR-3B.
26 July 2024
Claiming Input Tax Credit (ITC) for GST paid on restaurant bills and lodging services, as business expenditures, involves specific steps and compliance with GST rules. Here's how you can handle these inputs and record them properly:
### **1. **Claiming ITC on Restaurant Bills**
#### **Eligibility**
- **ITC on Restaurant Bills**: Under the GST regime, you can generally claim ITC on restaurant bills if the expenditure is directly related to your business and not for personal consumption. However, there are specific restrictions: - **Blocked Credit**: ITC is not allowed on food and beverages provided in a canteen or restaurant facility to employees (except in the case of employee-related services where the ITC is restricted). - **Business Purpose**: If the restaurant expenditure is related to business travel or client entertainment and is necessary for business operations, ITC may be claimable.
#### **Recording and Reporting**
- **GSTR-3B**: Report the total ITC claim, including restaurant bills, under the relevant ITC category. Ensure that the amount is included in the total ITC claimed in GSTR-3B.
- **GSTR-2A/2B**: GSTR-2A is an auto-populated statement that provides details of ITC available. You should reconcile your GSTR-2A with the ITC you claim in GSTR-3B. GSTR-2B, an auto-generated statement, provides the ITC eligible for the period.
- **GSTR-2**: GSTR-2 was an earlier return used for detailing ITC claims. As of the latest updates, GSTR-2 has been replaced by GSTR-2A and GSTR-2B. You no longer need to file GSTR-2 separately but must ensure the reconciliation of the details in GSTR-2A and GSTR-2B.
### **2. **Claiming ITC on Lodging Services**
#### **Eligibility**
- **ITC on Lodging Services**: You can claim ITC on lodging services (e.g., hotel bills) if the expenditure is for business purposes, such as travel for official work, client meetings, or other business-related activities.
#### **Recording and Reporting**
- **GSTR-3B**: Similar to restaurant bills, you need to include the ITC for lodging services in the relevant section of GSTR-3B, which summarizes your monthly or quarterly ITC claims.
- **GSTR-2A/2B**: Ensure that the ITC claimed matches with what is reflected in GSTR-2A and GSTR-2B. You need to reconcile and ensure that the credit claimed is eligible.
- **Documentary Evidence**: Maintain proper invoices and documentation as proof of the business expenditure for restaurant bills and lodging services. This is crucial for any future audits or compliance checks.
### **3. **Detailed Steps for ITC Claiming**
**A. **For Restaurant Bills**
1. **Ensure the Bill Includes GST**: Verify that the restaurant bill includes GST and is in the name of the business. 2. **Record in GSTR-3B**: Enter the total eligible ITC for restaurant bills under the appropriate category (usually in “Input Tax Credit” for “Input services”). 3. **Reconcile with GSTR-2A/2B**: Ensure the ITC claimed is reflected in GSTR-2A/2B.
**B. **For Lodging Services**
1. **Ensure the Invoice is Business-Related**: Check that the invoice for lodging services is for a business-related stay and includes GST. 2. **Record in GSTR-3B**: Enter the ITC for lodging services under the “Input Tax Credit” section in GSTR-3B. 3. **Reconcile with GSTR-2A/2B**: Match the ITC claimed with the details in GSTR-2A/2B to ensure accuracy.
### **4. **Consulting a GST Professional**
If there are complexities or uncertainties regarding the eligibility of ITC on specific expenses, consulting a GST professional or tax advisor can provide clarity and ensure compliance with GST regulations.
### **Conclusion**
- **Claim ITC in GSTR-3B**: You should report the ITC for restaurant bills and lodging services in your GSTR-3B. - **Reconcile with GSTR-2A/2B**: Ensure that the details are reconciled with GSTR-2A and GSTR-2B. - **Maintain Documentation**: Keep all related invoices and documentation for future reference and compliance.
By following these guidelines, you ensure proper claiming of ITC and adherence to GST compliance requirements.
CAclubindia
