+
Office refurbishment costs eligible for input tax credit, rules AAR
Real Estate

Office refurbishment costs eligible for input tax credit, rules AAR

Authority for Advance Rulings (AAR) ruled that the costs incurred for the refurbishment of offices can be eligible for input tax credit.

The ruling is set to create some confusion around the availability of tax credit under the goods and services tax (GST) framework.

Recently, Gujarat AAR ruled that the input tax credit is admissible on new locker cabinets and generators.

The tax credit can be utilised to set off future tax liabilities.

For now, only the cost that adds to the output of a firm — raw materials, input services, machinery, is available for input tax credit.

The new ruling comes when various firms across the nation have shifted their offices and have incurred expenditure on repair, renovation, temporary fittings, etc., amid the Covid-19 pandemic. According to tax experts, these companies can now take this decision to claim tax credits.

Tax experts told the media that, however, credit of goods and services used for repair and renovation of offices has always been a subject matter of litigation over the years essentially because it is difficult to determine what qualifies as immovable and what as plant and machinery.

Harpreet Singh, partner, indirect tax, KPMG, India, told the media that many dealers are availing input credit of new modular furniture, fixtures, fittings, cables, generators, etc.

with the plea that same can be quickly moved/ installed at various places, without being damaged and therefore do not result in immovable property.

Image Source

Authority for Advance Rulings (AAR) ruled that the costs incurred for the refurbishment of offices can be eligible for input tax credit. The ruling is set to create some confusion around the availability of tax credit under the goods and services tax (GST) framework. Recently, Gujarat AAR ruled that the input tax credit is admissible on new locker cabinets and generators. The tax credit can be utilised to set off future tax liabilities. For now, only the cost that adds to the output of a firm — raw materials, input services, machinery, is available for input tax credit. The new ruling comes when various firms across the nation have shifted their offices and have incurred expenditure on repair, renovation, temporary fittings, etc., amid the Covid-19 pandemic. According to tax experts, these companies can now take this decision to claim tax credits. Tax experts told the media that, however, credit of goods and services used for repair and renovation of offices has always been a subject matter of litigation over the years essentially because it is difficult to determine what qualifies as immovable and what as plant and machinery. Harpreet Singh, partner, indirect tax, KPMG, India, told the media that many dealers are availing input credit of new modular furniture, fixtures, fittings, cables, generators, etc. with the plea that same can be quickly moved/ installed at various places, without being damaged and therefore do not result in immovable property. Image Source

Next Story
Real Estate

Shriram Properties Launches ‘Codename: The One’ in Bengaluru

Shriram Properties (SPL), a leading real estate developer focused on the mid-market and mid-premium segments, has announced the launch of its latest residential project under the banner “Codename: The One” in Bengaluru’s Electronic City corridor. This feature-rich gated community will offer 340 spacious 2- and 3-BHK residences, with a total saleable area of approximately 5 lakh square feet and an estimated revenue potential of over Rs 3.5 billion. The project is expected to be developed over a span of more than three years.  Strategically located near the Bommasandra Metro stat..

Next Story
Resources

India Warehousing Show 2025 Closes with Strong Global Presence

The 14th edition of the India Warehousing Show (IWS) 2025 concluded successfully at Yashobhoomi (IICC), Dwarka, drawing participation from over 300 exhibitors across 15 countries and welcoming 15,000+ visitors. Recognised as India’s leading platform for warehousing and logistics excellence, IWS 2025 offered a comprehensive display of cutting-edge automation, sustainable warehousing solutions, and next-gen supply chain technologies. The show was inaugurated by Shri Pankaj Kumar, Joint Secretary – Logistics, DPIIT, Ministry of Commerce and Industry, Government of India. In his opening a..

Next Story
Equipment

MHIET Launches 450kW Gas Cogeneration System with H₂ Co-Firing

Mitsubishi Heavy Industries Engine & Turbocharger (MHIET), part of the Mitsubishi Heavy Industries Group, has launched a new 450kW gas cogeneration system, the SGP M450, jointly developed with Toho Gas Co.,. The system supports hydrogen co-firing at up to 15 vol per cent, with no loss in performance or reliability.  The system is currently available in the Japanese market, and has been developed from the existing GS6R2 city gas engine platform. Key modifications were made to the fuel gas and engine control systems to enable hydrogen co-firing.   Verified through de..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?