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ITC on employees food

nayab (Sr.Officer Accounts ) (250 Points)

18 March 2019

Dear team

our company given staff mess canteen service to agencie .
can I claim that ITC ..?
asper new amendment 01.02.19..

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3 Replies

Siva Raj (358 Points)
Replied 18 March 2019

yes u can claim, if such service is mandatory by law, for eg. if you have more than 250 employees you must have to provide canteen facility to your employees.

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pritesh (CA Final student) (7101 Points)
Replied 19 March 2019

Yes ..if it is mandatory for you to provide to employees under any other law.. otherwise it is covered under blocked credit under section 17(5)

CA Abhilash N (Chartered Accountant) (265 Points)
Replied 19 March 2019

Dear Nayab,

To add on, in terms of notification no. 13/2018 - CTR dated 26th July 2018, GST rate for Canteen services would be 5% provided that credit of input tax charged on goods and services used in supplying the service has not been taken. \

GST rate for supply of food at Exhibition Halls, Events, Conferences, Marriage Halls and other outdoor or indoor functions that are event based and occasional in nature would be 18% with ITC eligibility.

In your case, if company is providing canteen services on regular basis to various entities, then you have to charge GST at 5% and ITC could be restricted.