Sale of used car purchased pre GST

[Vivek anandhan]

Dear Experts

We have purchased one car for our office usage in pre GST regime, Now we are going to sale in GST regime. Whether we need to charge GST also for the sale used car.

Regards

Vivekanandhan

[DR.MARIAPPAN GOVINDARAJAN]

In my view GST is not leviable.

[Ganeshan Kalyani]

In my view, GST is applicable on margin i.e. sale value minus written down value computed as per Income Tax Act.

[Ganeshan Kalyani]

Refer Notification No.8/2018-CTR dated 25.01.2018.

[KASTURI SETHI]

The querist has used the words,' for our office usage'. It means car which is to be disposed of was meant for business purpose. The disposal of car is in the course of furtherance of business. So such transaction conforms to definition of 'supply' provided under Section 7 of CGST Act read with Notification No.8/18-CT(R) dated 25.1.18 (Serial no.4)

[RAKESH R]

Car is a business asset in the books of the business entity and claimed depreciation for income tax assessments. GST is applicable on supply of any goods irrespective of purchase before GST or Post GST. The taxable value for such used car shall be “ the difference between the depreciated value as on the date of sale and actual sale value realised from buyer.

if the difference is positive GST 18% or 12% ( see Notifications Jan 2018 and find in which category the used car falls) is payable on the difference. If the difference is negative you may ignore

S. Gokarnesan

Advocate , Chennai - 9840087349

AI Summary

GST on used business assets: sale taxed on the positive margin against depreciated value, otherwise no GST applies. Where a business sells a used car that was acquired pre GST but used for business purposes, the disposal qualifies as a supply. Taxable value is computed on a margin basis: the difference between the sale price and the depreciated/written down value (per income tax computation). If the margin is positive, GST at the applicable notified rate for the vehicle category applies to the margin; if negative, no GST is payable.