Restrictions on ITC:
partly for business and
partly otherwise, ITC shall be restricted to so much of input tax which is
attributable to the purposes of business.
is used for effecting partly taxable supplies
including zero-rated supplies and partly exempt supplies, ITC shall be
restricted to so much of input tax which is attributable to the taxable
supplies. The value of exempt supply shall include supplies on which tax is
paid on reverse charge, transactions in securities, sale of land and subject
to Schedule II 5(b), sale of building; but excludes the activities referred
to in Schedule III (except paragraph 5) and paragraph 8(a).
company or a financial institution shall have the option to avail 50% of ITC
every month and the rest shall lapse and the option once exercised shall not
be withdrawn during the FY.
ITC is not available for:
Motor vehicles having approved seating capacity up to
13 persons (including driver), except
when they are used for making taxable supply of transportation of passengers
or for further supply of such vehicles or for training on driving of such
Vessels and aircraft except
when they are used for transportation of goods or making taxable supply of
transportation of passengers or for further supply of such vessels or
aircraft or for training on navigating such vessels or flying such aircraft.
insurance, servicing, repair and maintenance of
vehicles, vessels or aircraft referred
above except the case where it is used for the purpose specified above or the
person receiving this service is either a manufacturer of such vehicles or
provider of general insurance services on such vehicles.
food & beverages, outdoor catering, beauty treatment, health services, plastic surgery, leasing,
renting or hiring of motor vehicles, vessels or aircrafts referred above except when used for the
purposes specified above, life insurance and health insurance. However, ITC
is available for inward supply of a category is used for making an outward
taxable supply of the same category or as a part of composite or mixed
supply. Supply of membership
of a club, health & fitness center
Travel benefits given to employees on vacation if employer is not obligated to provide the same
under any law.
Works contract services or supplies for construction of an immovable
property (other than plant &
machinery) except where input service is used for output supply of works
levy has been paid u/s 10
used for personal
Supply received by a non-resident taxable person except on goods imported by him
services received by a taxable person, used/intended for activities relating
to obligations under Corporate Social Responsibility u/s 135 of Companies Act, 2013 (w.e.f. 01-Oct-23)
Goods lost, stolen,
destroyed, written off or disposed of by way of gift or free samples
Any tax paid u/s 74, 129 & 130