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

Input tax credit on RCM for hiring buses with seating above threshold is allowable when used in taxable supplies.
When a hired bus from a non-corporate supplier has seating capacity greater than thirteen passengers, the restriction in Section 17(5) of the CGST Act on claiming input tax credit for renting or hiring of motor vehicles does not apply; consequently, where the recipient uses the bus in taxable supplies and accounts for tax under the reverse charge mechanism in accordance with the relevant notifications and Board circular, the recipient may avail credit of GST paid under RCM.