The availability of Input Tax Credit (ITC) on motor vehicles is often a topic of confusion, but here’s a clear breakdown for easy understanding.
If you run a business that provides driving lessons, you can claim ITC for the vehicles used in your training school. However, if you buy a car for personal use or even for general business use (without meeting the above exceptions), you cannot claim ITC.
Common Questions (FAQs)
Q1: Can I claim ITC on the purchase of my new car or bike for business?
No, ITC is not available on the purchase of new motor vehicles unless used for one of the specific business purposes mentioned above.
Q2: What if I use the vehicle for transporting employees or goods?
ITC is not available for vehicles used for transporting employees, and it also doesn’t apply to personal use vehicles.