As per notification No.8/2018 Central Tax (rate )GST on used cars will be levied on margin.
The Margin has to be arrived at by deducting the WDV as on the date of supply from the consideration.
The income tax adopts Block system for allowing depreciation.
The WDV of The Block in which car being sold is clubbed, might have been wiped out, or brouht down substantially because sale value of any one asset included in the Block.
A question araises how to arrive at WDV of car being sold for purpose of GST.
Even otherwise, the income tax Act does not allow any proportioante Depreciation upto date on sale of any asset.
Any suggestion to solve above two issues.
GST on Used Cars: Calculate Based on Margin of Supply Per Notification No. 8/2018 Using WDV or Book Value A discussion on the Goods and Services Tax (GST) applicable to used cars, initiated on August 18, 2018, received responses addressing the calculation of GST based on the margin of supply. The margin is determined by subtracting the Written Down Value (WDV) from the sale consideration, as per Notification No. 8/2018. If depreciation under the Income Tax Act is availed, GST is calculated on the positive margin, ignoring negative margins. The replies suggested using the book value or WDV from company accounts to determine the GST payable, noting differences between WDV under the Income Tax Act and company accounts. (AI Summary)
TaxTMI 
TaxTMI 
