We are a Private Limited Company based in Mumbai, Maharashtra. We have permanently disposed off our business assets without any consideration. We had claimed input tax credit on such assets. Is this transaction a supply under GST?
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Explain the Taxability of Transfer of Business Assets under GST ?
Explain the Taxability of Transfer of Business Assets under GST ?
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Greetings from Ssk Advisory. We are happy to resolve your query.
Please note, that as per Section 7 of the CGST Act, 2017, a transaction is considered as a supply if you sell goods or services for consideration and you enter into such transaction is in course of your business or for the purposes of furtherance of your business. However, Schedule I contains activities to be treated as supply even when there is no consideration involved.
If you permanently transfer or dispose off business assets without any consideration and have availed input tax credit at the time of purchase of business assets, it is to be treated as a supply under GST.
Please also refer to Explain the Taxability of Supply of Goods to Branch under GST ? for an additional type of transaction covered in Schedule I.
Hope we have been able to solve your query. Please comment below in case of any other queries or questions.