Sun1234 (Software Engineer) (3 Points)
02 August 2019Does 18% GST apply on the laptops that you buy from the employer ? Suppose company bought the laptop for 70,000 (invoice price - 2 years ago) and now after depreciation they are willing to sell it the employee (when he leaves) for 50,000 (written down value).
Can they apply 18% GST on 50,000 and say final selling price = 50,000 *18% = 59,000 ?
Technically it is a used item now. So I would imagine they should be no GST applicable.
Please clarify.
Thanks in advance.
Pankaj Rawat
(GST Practitioner)
(55047 Points)
Replied 02 August 2019
Lalit Goenka
(GST Practitioner)
(117 Points)
Replied 02 August 2019
Yes, if they have Claimed the ITC and have charged depreciation on it.
Sun1234
(Software Engineer)
(3 Points)
Replied 02 August 2019
Thanks for your reply Lalit. This is assuming the company has claimed ITC on it? Is there any way to check / verify that? Surely the company will not disclose it. Also the company bought this laptop for usage by employees and not for resale. And since its used for 2 years already before selling to the employee, doesn't this automatically become sale of used laptop?
I mean to say, it would make sense to apply 18% GST if the employer sold the brand new laptop (not used) or refurbished or upgraded laptop to employee (assuming they claimed ITC already). To make it more clear,
Scenario 1 (No ITC claimed by Employer)
1. Employer bought laptop from Vendor for company use in 2017 = 70,000 (including 18% GST) [ 59,323 + 10677 (18% GST) = 70,000)
2. Laptop used by Employee for 2 years
3. When employee leaves after 2 years, employer charges = {50,000 (their written down value from 70k or 59k? - not known) + 18% (9,000) ?} = 59,000
4. If employer has already paid GST while purchasing, why should the same item be taxed again at 18% after 2 years ?
Scenario 2 (ITC Claimed by Employer)
1. Employer bought laptop from Vendor for company use in 2017 = 70,000 (including 18% GST) [ 59,323 + 10677 (18% GST) = 70,000)
2. Employer for some reason claims ITC = 10,677
2. Laptop used by Employee for 2 years
3. When employee leaves, employer charges = 50,000 (their written down value from 59,323 ?) + 18% (9,000) ? = 59,000
4. Now are they going to pay 9000 GST to government on a used laptop sale ?
please clarify.
I think all of this depends on whether the transaction is considered a "used good sale" or "new good sale" after 2 years of usage?
Lalit Goenka
(GST Practitioner)
(117 Points)
Replied 02 August 2019
As mentioned by Mr. Pankaj, There will be GST involved.
You are buying the laptop from the company by paying consideration. Company being an registered party will have to charge you GST for the same. Even if ITC availed or not by the company.
Shivam RC
(Student)
(23683 Points)
Replied 02 August 2019
pradeep goyal
(Senior Partner)
(7561 Points)
Replied 02 August 2019
Pankaj Rawat
(GST Practitioner)
(55047 Points)
Replied 03 August 2019
Dear Pradeep
As per section 7 (1)(c) the activity specified in Schedule I made WITHOUT CONSIDERATION, & schedule I ,entry No. 1 Permanent Disposal of Business assets where INPUT TAX CREDIT has been availed on such assets
As per above if supplier is receiving the CONSIDERATION, then even though the Input Tax Credit is NOT availed, doesn't matter., so its attracts GST
Nishant Varshney
(2 Points)
Replied 17 August 2023
Sir,
I have similar condition and i read all the comments above,
i have resigned from an organization recently, the company has charged GST on laptop provided to me. Following are the details:-
i) 60,000/- (initial buying price including GST ) provided to me.
ii) The laptop policy of company is :- " you will be allowed one time reimbursement for mobile phone and laptop subject to the maximum ceiling of Rs. 10000 and Rs. 60000 respectively, which enables you to contribute effectively for company works. Depreciated value of the gadgets shall be recovered from employee if he/she leaves the employment in less than "2 years" of service. however, the employee shall be allowed to retain the gadgets at the time of separation after completion of more than 2 years of service."
iii). The above mentioned policy at point (ii) is for contractual employees only, i was working as fixed term employee in the organization. Here, it is important to mention that, as per the interpretation of accounts deptt., the time period for calculating depreciation on the gadget is 3 years (same as of regular employees) as the policy didn't mentioned the time period for calculating depreciation.
iv) Now, i have resigned after 15 months and 2 days of service i.e. on 20 july 23, i bought the laptop in dec 22. after depreciation the valuation is 48000 approx and with gst, total 56600/-(approx).
my doubt is if i resigned (let say) within a month after buying the laptop , the depreciation would be very minimal and with GST, the total amount payable will be 58300(valuation) + 10504(GST) = 68860/- (approx) which is >> "60,000/-" which the company initially gave to me (included GST).
How is this possible? This seems unfair. why would i buy a used asset higher than the initial price?????
OneClickFormat com
(2 Points)
Replied 21 January 2024
Sab chutiyagiri hai ye gst ki. Bhai Dhanda kare to kaise kare. 2nd hand laptop walo ke pass gst bill nahi rehta Original purchase ka. So quantity material lenge to 18% nahi parwadta. Mai kya bolta hu. Used item ke liye GST lagana fully Unfair hai. Plz sab aawaj uthao. Modi ji gst hatao used/ refurbished and Import Electronic items ka.
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