B.ANIL REDDY (Student) (78 Points)
05 May 2018Hello members,
If a hospital was running it's operations in a owned property, and has given a minor portion of the Hospital for rent to an ATM. Do it need to charge GST on that income from Rent. The hospital has a Pharmacy department seperately which Pays GST on Pharmacy sales to out Patients. The Hospital will also receives rent for Placing Mobile Tower on the Last floor of the Building.
Thankyou.,
Jeeva Thangavelu
(Student CA Final )
(609 Points)
Replied 05 May 2018
Yes. Rent has to be collected along with GST for both ATM and Mobile tower.
CA Shivam Arora
(Chartered Accountant)
(2414 Points)
Replied 05 May 2018
Mr. Jeeva is absolutely correct.
B.ANIL REDDY
(Student)
(78 Points)
Replied 05 May 2018
Okay Sir,
But can it take input on indirect Expenses of the Hospital like internet charges, Purchase of Computer like assets otherthan hospital equipments.,
Or can you explain me on what expenses can the Hospital take ITC for the above GST Payment
Thankyou.
Jeeva Thangavelu
(Student CA Final )
(609 Points)
Replied 05 May 2018
GST is not applicable on Hospital Service. Hence ITC cannot be claimed from expense on goods or services relating to provision of such services. However in case if there is a pharmacy and GST is paid on its sale proceeds, then ITC can be availed ;
1. on all expenses for goods and services directly relating to the running of pharmacy
2. proportionat input on service and goods purchased for administrative expenses can be claimed where such expenses cannot be segregated for pharmacy and other hospital service.(ex: telephone, internet, assets like computer, etc.)
In your case, ITC on all expenses relating to the maintenance of ATM room and Mobile tower (if incurred by hospital) can be claimed.
CA Shivam Arora
(Chartered Accountant)
(2414 Points)
Replied 05 May 2018
1)Hospital is providing healthcare service which is exempt. So, ITC on any input or input service which is used to provide healthcare service should not be claimed.
2)Hospitals are also providing taxable services such as cosmetic surgery, car parking service, notice pay etc. which are taxable. So, ITC on any input or input service which is used to provide the above mentioned should be claimed, which will be a very small amount.
But, practically speaking bifurcation of such ITC as per rule 42 will be a difficult task and moreover it will be a difficult to satify the officer in case of audit. So its better not to avail any ITC in case of hospital. Only those ITC which are specifically against taxable supply like cosmetic surgery, car parking service, notice pay etc. can be availed.
B.ANIL REDDY
(Student)
(78 Points)
Replied 05 May 2018
Okay,
Thank you Sir, for such explanotory replies.
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