Can You Claim ITC on Car Purchases under GST ?
Can You Claim ITC on Car/Motor Vehicles Purchases under GST? In 2024 In India, claiming Input Tax Credit (ITC) on purchases helps businesses reduce their overall tax burden. But when it comes to cars/motor vehicles, things get a bit tricky. Here's a breakdown of ITC eligibility for car purchases under GST: Generally Not Eligible for ITC Section 17(5) of the CGST Act restricts ITC on motor vehicles with a seating capacity of less than 13 people (including the driver). This covers most personal and regular cars. This means most standard cars you see on the road wouldn't qualify for ITC. This applies even if you use the car for business purposes. Exceptions to the Rule - Eligible for ITC Vehicles with More Than 13 Seats: Larger vehicles like buses or vans used for passenger transport (like a tourist company) qualify for ITC.Vehicles for Further Supply/ Selling Vehicles/ Selling Cars :If your business d ...
