• GST ITC

1. What does Expempt supplies includes ??
2. Whether GST on Input services for the outward supply @ NIL rated can be availed?
3. What will be the provision if we have availed GST on the Capital goods, if our outward supplies consist of Nil rated, Taxable, Zero rated supply ?
Asked 5 years ago in GST

Hi,

 

- Exempt supplies means supplies which are not taxable i.e. NIL rated or exempt by way of notification.

- No, ITC can not be availed on exempt services.

- ITC will be allowed proportionately on taxable supply only, remaining will be disallowed and you need to pay the ITC alongwith the interest @ 24% from the date of ITC availed till the the date of payment.

 

Thanks

Vivek Kumar Arora
CA, Delhi
4825 Answers
1030 Consultations

5.0 on 5.0

Exempt Supply means supply of any goods or services or both which attracts nil rated of tax or which may be wholly exempt under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes Non- Taxable supply.

No ITC cant be availed

You need to reverse it and if you dont reverse it you need to pay interest as well.

 

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

Naman Maloo
CA, Jaipur
4265 Answers
96 Consultations

5.0 on 5.0

Hi,

 

Hope you are doing well !!

 

1.Exempt supplies comprise the following three types of supplies:

  1. Supplies taxable at a ‘NIL’ rate of tax* (0% tax);
  2. Supplies that are wholly or partially exempted from CGST or IGST, by way of a notification amending Section 11 of CGST Act or Section 6 of IGST Act;
  3. Non-taxable supplies as defined under Section 2(78) – supplies that are not taxable under the Act (For Example Alcoholic liquor for human consumption.

2. No, it can not be availed.

 

3. It would be proportionately allowed i.e. ITC can be availed only for taxable portion.

 

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

Hi,

 

1. Eg. of exempted supply are sale of unbranded food articles such as Maida, besan, healthcare services, education services etc.

 

2. No, ITC cannot be availed against nil rated supply.

 

3. GST will be available on a proportionate basis. Pls note that you can't claim depreciation on GST amount if you have claimed ITC for that amount.

Lakshita Bhandari
CA, Mumbai
5687 Answers
908 Consultations

5.0 on 5.0

Hello,

1. Exempt supply means supply of any goods or services or both which attracts Nil rate of tax or which may be wholly exempt from tax and includes non-taxable supply.

2. No, it can be availed for effecting taxable supplies including zero-rated supplies.

3. Proportionate credit would be available in respect of the taxable and zero-rated supply.

I hope this answer satisfies your requirement.

 

Regards,

CA Hunny Badlani

Hunny Badlani
CA, Madhya Pradesh
2608 Answers
16 Consultations

5.0 on 5.0

Hello Sir,

 

1. As per section 2(47) of CGST Act 2017, an exempt supply means any goods or services or both:

  • which attract nil rate of tax or
  • that may be wholly exempt from tax under section 11 or
  • may be wholly exempt from tax under section 6 of IGST act or
  • including non-taxable supply

Thus, exempt supply includes the supply of following types of goods or services:

  • supply attracting nil rate of tax
  • supplies wholly exempt from tax
  • non – taxable supplies

 

2. No.

 

3. ITC on common capital goods to be reversed as attributable to use for exempt supplies

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

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