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Old 21st August 2019, 15:35   #166
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Default Re: Effect of GST on Car Leasing

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Originally Posted by spr1ngleo View Post
Thank you. I am eyeing at Nexon petrol XT+. Not sure if that's really a high end car. Driver salary of 18k, fuel reimbursement of 15k, an EMI of 26k, at 18% residual value. I will buy back the car at end of 36 months, and plan to keep it for its lifetime. Your opinion please?

TIA.
Go for it!
Plus you will have another 3 years to identify an allowed family member/friend in whose name you can transfer the car at end of lease period (and save perquisite tax as well)

Buying less than 4 meter and <1500cc petrol engine car is most beneficial under car lease/GST regime from tax purposes.
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Old 15th February 2020, 23:10   #167
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Default Re: Effect of GST on Car Leasing

Hello Everyone,


I have pre-GST regime lease car.

As per my understanding, three year of discount period for GST on lease car should be over in June 2020. My lease will end in Nov 2020. I am planning to terminate lease before the discount ends. Any advice whether it will be good idea to terminate lease before June 2020?


Do anyone have any update on the petition filed in the court?


Thanks in Advance!
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Old 7th March 2020, 17:50   #168
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Default Re: Effect of GST on Car Leasing

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Originally Posted by anubhav22 View Post
...
Buying less than 4 meter and <1500cc petrol engine car is most beneficial under car lease/GST regime from tax purposes.
Can you help me understand the calculation behind this statement? AFAIK the GST percentage on a lease rent is same as the GST percentage the car falls in. Then how come a lower GST slab is beneficial?
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Old 7th March 2020, 18:08   #169
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Default Re: Effect of GST on Car Leasing

If you calculate the EMI + residual value (incl GST) for a small car and then deduct the tax savings, it works out to just around 3-4% interest. On top of that, you might potentially get reimbursement for fuel, service, insurance, driver salary etc depending on your company (or get it cut from your allowance, which in turn means a straight 30% savings (or less) depending on your tax bracket). Which makes it pretty attractive for a car falling under 4m car
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Old 7th March 2020, 18:35   #170
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Default Re: Effect of GST on Car Leasing

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Originally Posted by sanchari View Post
If you calculate the EMI + residual value (incl GST) for a small car and then deduct the tax savings, it works out to just around 3-4% interest. On top of that, you might potentially get reimbursement for fuel, service, insurance, driver salary etc depending on your company (or get it cut from your allowance, which in turn means a straight 30% savings (or less) depending on your tax bracket). Which makes it pretty attractive for a car falling under 4m car
But this would be true for larger cars as well. Why only < 4m?
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Old 7th March 2020, 19:04   #171
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Default Re: Effect of GST on Car Leasing

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Originally Posted by ank.nsit View Post
But this would be true for larger cars as well. Why only < 4m?
For >4m car, the effective interest rate increases much more as the GST on the lease rate will increase. One has to check the lease rates offered by their company including GST, and then do the calculations to see if its worth it or not.

Also, most important point, go for lease only if you plan to stick around in that company for the entire leasing duration. Breaking lease is pretty expensive, and if your company offers transferring lease to another employee, then that would be a viable option.
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Old 7th September 2020, 17:16   #172
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Default Re: Effect of GST on Car Leasing

Hello. Is this news positive for corporate operating lease as well?

https://www.livemint.com/industry/ma...213826969.html

Also, if I don't wait for actual gst cut, if any, and start my leasing tenure now, is it normal to expect leasing company to pass on the tax reduction benefit to customer when/if it happens?
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Old 16th December 2020, 14:31   #173
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Default Re: Effect of GST on Car Leasing

Hi, for people who have recently closed their lease, can someone let me know how the calculations were done for gst on residual value and security deposit.
In my case, I had taken an X1 on lease about 4 years back. That time I had made a security deposit of about 5.4 lacs. The residual value was to be about 7 lacs. Now the lease is getting over and the calculation I have received from the leasing company is 7 lacs plus 48% gst minus security of 5.4 lacs. My question is whether gst should be calculated on RV or RV minus Security. This calculation alone makes a difference of about 2.5 lacs for me so asking
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Old 16th December 2020, 14:59   #174
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Default Re: Effect of GST on Car Leasing

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Originally Posted by fatsoboy View Post
the calculation I have received from the leasing company is 7 lacs plus 48% gst minus security of 5.4 lacs. My question is whether gst should be calculated on RV or RV minus Security.
If they have not treated your security as an advance EMI or Down-Payment, you will have to pay GST on the residual. They will refund security seperately.
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