Goods and Services which are not eligible for ITC

Reading Time: 2 minutes

Goods and Services which are not eligible for ITC under GST

• Motor vehicles and conveyances except the below cases:-
  Such motor vehicles and conveyances are further supplied for sale
  1. Transport of passenger
  2. Used for imparting training on driving, flying, navigating such vehicle or conveyances.
  3. Transportation of goods.

• Food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery
  But if the good and/or services are taken to deliver the same category of services or as a part of a composite supply, Input tax credit will be available.
  Example: Taxpayer purchases cosmetic creams to supply it to a customer, then the credit of ITC paid on purchases will be allowed.Sale of membership in a club, health, fitness club

• Rent-a-cab, health insurance, and life insurance except the following:-
  1. Government makes it obligatory for employers to provide it to its employees
  2. Good sand/or services are taken to deliver the same category of services or as a part of a composite supply, credit will be available.
     Example: Taxpayer takes the service of the rent-a cab to supply to Mr.Manoj, a customer, then the credit of ITC paid on purchases will be allowed.

• Travel_benefits extended to employees on vacation such as leave or home travel concession.
• Works contract service for construction of an immovable property (except plant & machinery or for providing the further supply of works contract service).
• Goods and/or services for construction of an immovable property whether to be used for personal or business use.
• Goods and/or services where tax has been paid under composition scheme.
• Goods and/or services used for personal use.
• Goods or services or both received by a non-resident taxable person except for any of the goods imported by him.
• Goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples.
• ITC will not be available in the case of any tax paid due to non-payment or short tax payment, excessive refund or ITC utilized or availed by the reason of fraud or willful misstatements or suppression of facts or confiscation and seizure of goods.