ITC ON MOTOR VEHICLE INSURANCE

[Guest]

Dear Experts,

I have a firm named as 'xyz solutions' (trade name). The firm has GST registration and I am the sole proprietor of this firm (legal name = my name).

I have a car having commercial registration with taxi passing. The vehicle is being used for public transport. Here the vehicle is registered under my name.

And here is my question, 'would i be able to claim the ITC on GST amount on buying/renewal of the motor vehicle insurance policy?'

Awaiting response, Thanks...

[KASTURI SETHI]

Not allowed.

[KASTURI SETHI]

Also go through the lengthy discussion on this issue in October, November, 17 in this forum.

[YAGAY andSUN]

In our view it is available, As per Sec 17(5)(a) - ITC will not be available on PURCHASE OF MOTOR VEHICLE & OTHER CONVEYANCE except when it is for transportation of passengers.

[Ganeshan Kalyani]

In my view ITC is available if transportation of passenger is the nature of business carried out by the querist and the vehicle has been used for that purpose. Here I assume the core business is different hence admissibility of credit is doubtful.

[Guest]

Okay, reply also came an accountant of a Pvt ltd company who shared that they have number of vehicles with private registrations and they do claim the ITC on the invoices of insurance and maintenence expenses of their vehicles.

And he added that if the vehicles are assets of the company then ITC can be claimed. Now here is the catch for me. In the annual return the on my name, xyz Solutions' income, expenses, profits, losses are shown seperately and the income, expense and margins from this taxi vehicle is represented as income from other sources. What can I do now....

[Guest]

ITC Cannot claim for Purchase of Motor vehicle and Insurance on car

JAYAKUMAR.J

AI Summary

Debate on ITC for Motor Vehicle Insurance: Experts Discuss Section 17(5)(a) on Commercially Registered Public Transport Cars A business owner inquired about claiming Input Tax Credit (ITC) on the Goods and Services Tax (GST) for motor vehicle insurance on a commercially registered car used for public transport. Responses varied: some experts stated ITC is not allowed, referencing previous discussions, while others argued it is permissible under Section 17(5)(a) if the vehicle is used for passenger transport. Another contributor shared that their company claims ITC on insurance for company-owned vehicles. The owner expressed concern about reporting vehicle income separately as 'income from other sources' and sought further guidance.