GST Credit In case of Hotel Booking

[CABIJENDERKUMAR BANSAL]

Dear Sir,

If a company registered in Noida makes hotel booking in Mumbai then how GST credit can be taken.

As in case of Immovable property, place of supply is place of immovable property then Mumbai hotel will charge CGST +SGST . Then can be take credit of this GST.

In other case, if we book through travel agent in Delhi, and if it charges IGST then can we take GST credit in this case ?

Please clarify GST credit mechanism in case of hotel booking and how should we plan to take maximum GST credit.

Thanks

CA Gorav Goyal

[Rajagopalan Ranganathan]

Sir,

If you avail the services of hotel booking at Mumbai and paid CGST ans SGST, then you can take credit of CGST paid and utilise the same for payment of CGST. SGST paid at Mumbai can not be taken as credit and utilise the same for payument of SGST at Noida (Utter Pradesh) since Noida is in different state than Mumbai.

If you book through a travel agent then the travel agent will charge IGST since it is inter state supply and credit of IGST can be availed and can be utilised the same for payment of IGST, CGST or SGST in that order.

[Ganeshan Kalyani]

If you have a branch in Mumbai then ask the hotel to raise invoice to that branch. That branch can take credit of both the component viz CGST and SGST. If that branch does not have output GST payable, then it can transfer such credit by registering it as input service distributor.

[vk agarwal]

I agree with Mr Kalyani

[THYAGARAJAN KALYANASUNDARAM]

Dear sir,

As per my opinion as given below.

ITC on the hotel bills in respect of accommodation, the levy under GST is location of immovable property situated. Hence, the Mumbai hotel will charge only cgst and sgst, that cannot be claimed by the company located in other states.

Further, even if the ticket booking done through travel agent located in noida, then the hotelier located in Mumbai will charge only cgst and sgst to the travel agent, who is in turn cannot claim the itc and it will be added and cost to them, in addition again they will charge local cgst and sgst to noida company, that alone we can avail the credit.

In case if the travel agent and hotel both arel located in mumbai and the noida company book the hotel, the travel agent only can avail the ITC and again they will charge only sgst and cgst with respect of hotel booking, that cannot avail credit by the noise company.

[CABIJENDERKUMAR BANSAL]

Dear Sir,

Thanks for the reply.

One further query, on what ruling/notification basis this interpretation is given ?

I understood well that in case of immovable property place of supply will be location of supply.

So when hotel is charging CGST and SGST from different state, then why we can't take credit of CGST as CGST is a central tax ?

Please clarify.

AI Summary

GST input tax credit for hotel bookings: IGST credit usable against liabilities; CGST/SGST credit constrained by place of supply. Input tax credit on hotel accommodation is governed by the place of supply for immovable property: the hotel's location determines CGST and SGST applicability. A purchaser in another state cannot utilise SGST paid in the hotel's state; CGST credit is usable only against central tax liabilities. If a travel agent charges IGST for inter state booking, IGST credit can be availed and utilised in the prescribed order. A local branch in the hotel's state can claim both CGST and SGST and may distribute unused credit via an input service distributor.