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GST Implications on movable & immovable property/equipment

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Naveen Kumar C D

42 Points Posted on 28 February 2024

is there is any GST loss in Capitalization of Immovable Assests

is there is any GST loss in Capitalization of movable Assests

Replies (2)

Quick Summary

This discussion clarifies the Goods and Services Tax (GST) implications when capitalising movable and immovable assets. For immovable assets like buildings, Input Tax Credit (ITC) is generally blocked, meaning the GST cost is added to the asset's value. However, for movable assets such as machinery, full ITC is usually available. It's crucial not to claim depreciation on the GST component if you've claimed ITC, as this can lead to denial of the credit.

sabyasachi mukherjee

Profession

19978 Points Posted on 28 February 2024

No there are no such losses.

Aashok Kumar Sharma

Finance/Compliance Consultant

75642 Points Posted on 08 November 2026

ITC and capitalisation:
• Immovable assets (buildings, civil works, works contracts for construction): ITC is blocked (17(5)(c), (d)) if capitalised, except plant and machinery. So the GST becomes part of the asset's cost (a "loss" of ITC).
• Movable assets (machinery, computers, furniture used in business): ITC is available (capital goods) in full on receipt. Don't add GST to the cost if ITC is claimed. If you claim depreciation on the GST component, ITC is denied (Sec 16(3)).