Input tax credit on vehicles???

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hello friends, please help.

someone plz tell me whether tax paid on the purchase of vehicles which are to be used for the delivery of manufactured goods can be claimed as input tax credit from the output tax payable under VAT

Replies (8)

Definately. The whole of the VAT paid on purchase of a capital asset like vehicle is eligible for full ITC (Input Tax Credit).

I think not eligible for ITC, because ITC is only allowed to the consumables/ Raw material to be consumed for manufacture the finished goods.Please refer the link below-

https://www.pextax.com/Guidelines_InputTax.htm

As per Karnataka VAT Act Input tax credit of VAT paid on purchase of all kinds of motor vechiles not allowed.

Regards

Dayananda

 

I think Input tax credti of vat  paid on purchase of  vechiles is not allowed. Input tax  adjusted into output tax only same item.

Under MVAT (maharashtra), tax paid on capital goods is allowed after deducting 4% from the value of the goods. this issue can be ressolved by consulting a professional practicing in the relevant state....

As per Karnataka VAT Act 2003, vehicles fall under the category of INPUT TAX RESTRICTED GOODS and hence not elibile for ITC.  The schedule is reproduced below:


FIFTH SCHEDULE
INPUT TAX RESTRICTED GOODS

(Section 11(3))


1. Motor vehicles of all kinds, aeroplanes, helicopters or any other type of flying machine, parts and accessories thereof including tyres, tubes and flaps.


2. Articles of food and drinks, including cakes, biscuits and confectionery; ready to serve foods; processed or semiprocessed or semi-cooked food-stuffs; fruits, fruit and vegetable products sold in any kind of sealed containers; dressed chicken, meat, fish, prawns, shrimps and lobsters sold in any kind of sealed containers; aerated water, including soft drinks; sweets 826 Value Added Tax [2004: KAR. ACT 32 and sweet meats; instant mixes; soft drink concentrates; spice powders, pastes and the like; tobacco and tobacco products.


3. All electrical or electronic goods and appliances including air conditioners, air coolers, telephones, fax machines, duplicating machines, photocopiers and scanners, parts and accessories thereof, other than those for use in the manufacture, processing, packing or storing of goods for sale and those for use in
computing, issuing tax invoice or sale bills, security and storing information.


4. Textiles, crockery, cutlery, carpets, paintings and artifacts.


5. Furniture including slotted angles and ready to assemble parts of furniture, stationery articles including paper, sanitary fittings, cement and other construction materials including bricks, timber, wood, glass, mirrors, roofing materials, stones, tiles and paints, toilet articles.

 

Hope this clarifies...

As per maharahtra vat act also , input credit on purchase of vehicles is not allowed as per rule 54 (a)

As per M.Vat Act. ITC on passenger vehicle purchase is not eligible, whereas vat credit is allowable on  vehicle purchase other than passenger vehicle.

 


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