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input tax credit

rahul (student) (66 Points)

07 May 2018

input tax credit is available on staff welfare expenses like canteen services to employee s... ??

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8 Replies

john legend (376 Points)
Replied 07 May 2018

as per sec 17 (5) u cannot take input tax credit for any food and beverages ,u can take inly if ur outward service is same as input service therefore is blocked ceedit

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CA Sunil (Internal Auditor) (204 Points)
Replied 07 May 2018

Under section 17(5) of CGST Act there are certain supplies on which input tax credit under GST is not available.

1. Motor vehicles and other conveyances except rent a cab, stage carrier, contract carrier and imparting training.

Supply of goods/or services such as:

a) Food and beverages

b) outdoor catering,

c) beauty treatment,

d) health services,

e) cosmetic and plastic surgery

Hence it comes under prohibited list, hence no ITC on Staff welfare expense in the nature of Canteen expenses, tea & coffee, Club fee and Beverages etc.

No ITC.....;)

Pralay Chakraborty (Service) (440 Points)
Replied 07 May 2018

It would be better not to take credit in view of ORDER No.CT/531118-C3 DATED 26/03/2018, which specifically disallow credit for canteen related expenses. Rest of the welfare expenses to be decided on a case to case basis.

RAJA P M ("Do the Right Thing...!!!") (127969 Points)
Replied 07 May 2018

Hi to All...

If Staff welfare expenses is under sec 17(5)... Then

Where is the Canteen Service is under sec 17(5)...?

Pralay Chakraborty (Service) (440 Points)
Replied 07 May 2018

17(5)[b][i]

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john legend (376 Points)
Replied 07 May 2018

yes raja

big manufacturing company has their own canteen to provide food to their employees
but they are not able to provide food on their own so they outsource that thing to 'canteen service provider'

thus canteen service provider charges from company like

food supplied +service charge +gst

thus ultimately such food and beverages are taken as staff welfare ledger therefore it is indirectly covered under sec 17(5)

hope u got my point

RAJA P M ("Do the Right Thing...!!!") (127969 Points)
Replied 07 May 2018

Mr. John Legend!...!

(yes raja).....???! not like that based on your name pattern...

It's like inward supplies...!!!

How many views it's like outward supplies...???

john legend (376 Points)
Replied 07 May 2018

bro

for canteen service privider it is outward supplies
for company service provided by canteen service provider is inward supply

canteen service provider not only charges food but also it service charge if company gives full contract to him

hope u understand now