GST on used vehicle

[sunil kumar]

Dear Sir,

Iam a registered dealer under GST.May I request your expert advice as under:

If I purchase a repossessed vehicle @ 100000-00( which falls under 12% gst)

PURCHASE PRICE :- 100000-00

EXPENSES ;- 25000-00 (on insurance cover,MV tax,Parking charges to yard,4 tyre, (incld.GST)

Sold the vehicle@ ;- 150000-00

Net Dealer Margin :- 25000-00

Would I have to pay the GST on Dlr Margin i.e on 25000-00 or on the difference of sale price & purchase price 150000 (-)100000 )= 50000

Kindly have your kind advice on the above confusion.

Regards,

Sunil

AI Summary

Margin scheme in GST: tax applies to the dealer's margin including refurbishment costs, with ITC restrictions.
GST for second hand motor vehicle dealers under the margin scheme is payable on the dealer's taxable margin - the difference between sale and purchase price - and must include any value added by repair, refurbishing or reconditioning; sellers under the scheme must not issue taxable invoices and purchasers cannot claim input tax credit.