I have purchased asset and took the ITC on it and after some time I have sold the asset.
So I have to pay the tax on sale of asset or reverse the ITC or both?
you pay gst on sale of asset and reverse the ITC
3 Replies
Pankaj Rawat
(GST Practitioner)
(55052 Points)
Replied 18 January 2019
As per Rule 44
You have calculate the ITC for remaining useful life of capital asset & GST on Transaction value (Sale value) whichever is greater is to be deposit.
suppose asset purchase for RS.50000 & paid GST 9000
>The useful life of asset is 60 months
> used asset for 4 years (48 months)
To calculate ITC attributable to remains usfule life is = ITC X months remain ÷60
= 9000 x12/60= 1800/-
And if suppose sale value is 9000 & GST is 1620/-
Then the GST payable will be 1800/- on sale capital asset
You have calculate the ITC for remaining useful life of capital asset & GST on Transaction value (Sale value) whichever is greater is to be deposit.
suppose asset purchase for RS.50000 & paid GST 9000
>The useful life of asset is 60 months
> used asset for 4 years (48 months)
To calculate ITC attributable to remains usfule life is = ITC X months remain ÷60
= 9000 x12/60= 1800/-
And if suppose sale value is 9000 & GST is 1620/-
Then the GST payable will be 1800/- on sale capital asset
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