Are we eligibile to take input of GST paid under RCM on hiring of bus (having capicity 45 passenger)

[Tikam Gupta]

Dear Sir,

We hire buses form non body corporate for our customers. We are paying 5% GST under RCM on hire charges according to the latest notification.

My query is can we we take input benefit of this GST amount. Because section 17 (5) of CGST Act, 2017, restrict to take credit only 'renting or hiring of motor vehicle having approved seating capacity up to 13 persons (including driver).

Please advice.

AI Summary

Businesses Can Claim ITC on GST for Hiring Buses with Over 13 Seats Under RCM: Section 17(5) Clarified A business inquires about the eligibility to claim input tax credit (ITC) on GST paid under the Reverse Charge Mechanism (RCM) for hiring a bus with a seating capacity of 45 passengers. The query references Section 17(5) of the CGST Act, 2017, which restricts ITC for vehicles with up to 13 seats. Responses clarify that buses with seating capacities over 13 are not restricted by this section, allowing ITC claims. The GST paid at 5% under RCM is due to the supplier being a non-body corporate, and recent notifications and circulars do not impose further restrictions.