ITC ON COMMERCIAL VEHICLE PURCHASED ON LOAN

[Guest]

I am a sole proprietor of firm M/s ABC and my frm is GST registered. I deal in taxable supply of goods @5% GST. Now, i have decided to purchase a truck (for transportation of the same goods) on LOAN . I am incurring GST on its cost as well on its insurance payment. So my queries is :

a. Can i avail ITC on the above purchase?

b. If yes, then in order to avail ITC in whose name i should take the loan under my name or under my firm's name?

[Yash Jain]

Dear Sir,

Yes you can very well avail the ITC.

Reason : You are using it for the furtherance of your business.

Take invoice in the name as being mentioned in GST Certificate.

Comments from esteemed members highly solicited.

Rgds

[DR.MARIAPPAN GOVINDARAJAN]

Yes, you can avail ITC.

Since GST registration certificate is in your firm name, it may be in the firm name.

[Rajagopalan Ranganathan]

Sir,

A firm managed by a sole proprietor is not a distinct legal person like a public limited company. A sole proprietor firm is represented by the proprietor. Therefore you can take the loan either in your name or in the name of firm. However since you are going to avail ITC of GST paid on the vehicle cost and cost of insurance it is better to take the lone in the name which reflected in the Registration Certificate.

[Guest]

Thanks to the members for their replies.

In the GST registration certificate, trade name is my firm's name and legal name is my name, so can i take loan in my name??

[Nitika Aggarwal]

Dear Sir,

The loan should be taken in the name of registered person i.e. the person who is registered under the provisions of CGST Act, 2017.

Regards

Nitika Aggarwal

9999804960

AI Summary

Input Tax Credit on commercial vehicle allowed where business use and invoices match the registered person claiming credit. Claiming Input Tax Credit on a commercial vehicle and related insurance is allowed when the vehicle is used for the furtherance of the taxable business, provided the tax invoice and supporting documents are in the name of the registered person claiming ITC. For a sole proprietor, the proprietor and firm constitute the same taxable person, so the loan may be in either name but documents should match the name on the GST registration to support the claim.