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Capital goods

05 December 2017

We were not registered in any tax act prior to GST, now registered in GST & have machines purchased in 2017 do we can get ITC on capital goods.

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6 Replies

Akshay (student) (69 Points)
Replied 05 December 2017

when you are purchasing any machinery for your factory, you will pay the applicable GST rate. This GST paid can be claimed as credit in the same way as inputs.

However, if you claim depreciation on the GST paid while purchasing the capital asset, you cannot claim input tax credit.

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prasad Nilugal ( GST Practitioner & Accounts ) (14851 Points)
Replied 05 December 2017

Yes registered person will get ITC ,subject to you must use for taxable supply and only for the busniess purpose . purchase invoice should be valid GSTN , with tax amount .

If the registered person Claim depreciation on the tax compoment of the capital goods under the provisions of the income tax act 1961 , the input tax credit on the said tax component shall not be allowed .