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Transfer/sale of used motor vehicles for a consideration at wdv,Rate of Tax ? Marginal scheme applies? can recipient avail ITC ?, Goods and Services Tax - GST

Issue Id: - 116796
Dated: 15-10-2020
By:- SSOE SSOE
Transfer/sale of used motor vehicles for a consideration at wdv,Rate of Tax ? Marginal scheme applies? can recipient avail ITC ?

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Sir/madam,

I explained my issue with a practical instincts

Motor vehicles are purchased by supplier in VAT era, and also ITC not availed, at present the referred vehicles are selling at WDV value + 5% margin

sale or Transfer of motor vehicles (No.10) =63,00,000/-

Depreciation taken as per IT act

Wdv of 10 vehicles is 60,00,000/-

Here my doubt is,

valuation in case of sale of motor vehicle ?

is margin scheme - i.e, Notification no.8/2018-central tax rate dated 25.01.2018

as per this notification tax is payable on margin value (consideration received- wdv)

rate of tax =18 %

is this notification is applicable for sale of motor vehicle ?

Suppose, if above notification doesnot applies , please specify the reason and also mention alternative implications , i.e, rate of tax, taxable value for GST implications

Thanking in advance

Regards

Gowtham

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Posts / Replies

Showing Replies 1 to 2 of 2 Records

1 Dated: 16-10-2020
By:- Rajagopalan Ranganathan

Sir,

In my view you can sell the cars on payment of tax @ 18% (as per Notifn. No. 8/2018-CT (Rate) dated 25.01.2018 on the transaction value. The difference between the purchase price and selling price is for the purpose of valuation only. If the difference is negative then you need not pay any tax.


2 Dated: 17-10-2020
By:- KASTURI SETHI

In the above scenario, Notification No.8/2018-CT(Rate) dated 25.1.18 is applicable for the sale of old and used motor vehicles.


1

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