Availing IGST credit

[Chidambaram Subramaniam]

Dear Sir,

Our Company provide temporary accomodation to many of the outstation candidates at the time of joining the company through a vendor and the vendor charges IGST in all their invoices.

My Query is whether the company can avail credit of the IGST charged by the vendor for such nature of expenses.

Please guide us.

thanks and regards

Chidambaram

[KASTURI SETHI]

Dear Querist,

Will such expenses form part of Profit & Loss Account in the Company's Annual Report/Balance Sheet ?

[Chidambaram Subramaniam]

Dear Sir,

Yes, It forms part of our P&L account and balance sheet.

Regards

Chidambaram

[KASTURI SETHI]

In my view, this activity conforms to the definition of " ---------------------in the course of business or furtherance of business of the Company. Credit of IGST is admissible, if you qualify other conditions. Needless to say expenses of P&L Account are part of business.

[DR.MARIAPPAN GOVINDARAJAN]

Your company can avail credit.

[Brijesh Verma]

I am sorry but I am not able to comprehend as to how your vendor can charge IGST in respect of accommodation services! Please throw some light. Experts may correct my understanding if I am wrong.

[CASusheel Gupta]

Agree with experts, however

1) the vendor can charge only CGST+SGST

2) ITC allowed whether it is IGST/CGST+SGST

AI Summary

Input tax credit availability: IGST on vendor supplied business accommodation may be claimed if ITC conditions are met. Entitlement to input tax credit for IGST charged on vendor supplied accommodation depends on whether the expense constitutes a supply in the course or furtherance of business and on satisfaction of the statutory ITC conditions; while accommodation within a State is typically taxed under CGST and SGST rather than IGST, ITC admissibility is governed by compliance with ITC rules irrespective of whether tax is billed as IGST or CGST+SGST.