Can I claim input tax credit on a product that I bought under EMI?

GST Registrations and GST return Filings

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Hi there,

GST is basically charged in a purchase-sale transaction. You can avail ITC on all purchase-sale transactions provided you are complying with ITC rules.

However, to be able to claim this benefit, you must meet the following conditions

1. Payment the supplier within 180 days from issue of invoice

2. Inputs and capital goods should not be used for personal purposes

3. Inputs and capital goods should not be used for providing exempt supplies

If you do not meet these conditions, you are not allowed to claim input credit of the taxes paid on inputs.

EMI is linked with payment towards your purchase and it is nowhere linked to ITC rules. But the question arises here is are you paying the person within 180 days of the invoice date.

The answer is YES.

Since in EMI case, your bank is paying the seller upfront for a discounted rate and thereby satisfying your liability towards the seller.

In such a case, there is no reason that GST credit cannot be availed by you provided you satisfy other ITC rules.

Hope this helps.

Visit Business Helpers | Accountants, GST and Income Tax Consultants or mail us at for professional services and consultancy towards GST.

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