![]() | #31 |
BHPian ![]() Join Date: Oct 2009 Location: Bangalore
Posts: 328
Thanked: 429 Times
| ![]() There is an article in Moneycontrol which gives us some hope of an action taken during next GST council meeting in August. While we cannot expect earlier VAT equivalent rates, deduction of Cess of 15% can still be a little better as compared to what is been charged right now. http://www.moneycontrol.com/news/bus...g-2320919.html |
![]() |
|
![]() | #32 | |
BHPian Join Date: Nov 2009 Location: Bangalore
Posts: 73
Thanked: 20 Times
| ![]() Quote:
| |
![]() | ![]() |
![]() | #33 |
BANNED Join Date: May 2016 Location: MH-12
Posts: 55
Thanked: 102 Times
Infractions: 0/1 (5) | ![]() Did you foreclose the lease by paying residual value or returned your car to the vendor? What were the extra charges that you had to pay? My employer has not given me any clear picture on the change in EMI. I had raised a grievance on http://pgportal.gov.in/. I got the response as follow: "Your valuable suggestion has been noted." |
![]() | ![]() |
![]() | #34 | |
BHPian Join Date: Nov 2009 Location: Bangalore
Posts: 73
Thanked: 20 Times
| ![]() Quote:
Its little late to discuss this topic. I chose option of buying the car as our lease is too simplistic with no frills like other companies. Had to Pay: Book value, VAT, TCS, 1% penalty, Service Tax and insurance recoverable. few values are pro rated. For us Lease was never too lucrative. Thanks, Sanjeev | |
![]() | ![]() |
![]() | #35 |
Senior - BHPian ![]() Join Date: Jan 2014 Location: Bangalore
Posts: 1,452
Thanked: 2,978 Times
| ![]() The message seems to have reached the relevant officials now and they are looking at it: Finance Ministry Looks to Provide Tax Credit for Car Leasing under GST Car Lease Hopefully by 08-Aug we should have a decision that is fair! |
![]() |
![]() | #36 |
BHPian Join Date: Aug 2012 Location: New Delhi
Posts: 57
Thanked: 38 Times
| ![]() What's the GST rate for new car leases after 1 July? Will the monthly outgoing from the lessee be less, same or more than it was for pre-July? |
![]() |
![]() | #37 |
BHPian Join Date: Oct 2015 Location: Hosur
Posts: 593
Thanked: 820 Times
| ![]() What would be the GST effect for new cars taken under lease post July 1st, under the GST era? |
![]() |
![]() | #38 | ||
BHPian Join Date: Dec 2009 Location: Bangalore
Posts: 379
Thanked: 314 Times
| ![]() Quote:
Quote:
Given that, ex-factory cost of the car is considerably less now, which means that the lease rentals will be on lesser capitalized amount and that amounts to lower EMIs. Lease Rental Taxes would be more after GST, but the value is negligible in difference as the ex-factory amount is now considerably lower. Pre-GST : For Innova Crysta GX 2.8 AT, Ex-Showroom Price was 16.36L. So the lease rentals is calculated on 14.29L as the ex-factory Price (14.5% of Ex-Showroom). Lease rental taxes would be 14.5% + Service Tax of Capitalized amount. Leasing companies usually charge higher interest rate compared to Banks, but it will be on the capitalized amount. In this case, ~12% Interest for tenure of 5 years (usually ranges from 2 - 5 years). Post-GST : For the same Innova Crysta GX 2.8 AT, Ex-Showroom Price is 16.06L. And the lease rentals would be calculated on 28% of the Ex-Showroom Price, i.e ~11.5L. So the lease rentals would be considerably lesser when compared to pre-GST rates. Last edited by samabhi : 14th July 2017 at 14:59. Reason: Added example | ||
![]() | ![]() |
|
![]() | #39 | |
BHPian ![]() Join Date: Dec 2007 Location: Hyderabad
Posts: 423
Thanked: 111 Times
| ![]() Quote:
Also, does anyone have a clear idea on what input tax credit means -- does this affect our EMIs? Or will the EMIs be increased and we have to go through some complicated procedure towards the end to get this tax credit? | |
![]() |
![]() | #40 |
BHPian Join Date: Sep 2006 Location: Bangalore
Posts: 337
Thanked: 142 Times
| ![]() Luckily I got the option to foreclose the car lease before July 1st. Interestingly, I had taken this lease option whereby I could surrender the car without buyback and I was paying EMI on the depreciation value rather than total value of the car. This way I was paying EMI of only about 60% of normal lease plans, and I had to pay only 40k to surrender the car and terminate the lease. Post July 1st, there would have been a -VAT +43% GST impact, which is still agreeable. However the foreclose or buyback value would have shot up like crazy and this would not be financially viable. You could not have made up that money in the second hand market and net-net it would have been a huge loss for the buyer. However it seems new leases are more beneficial to the employee post-GST due to input tax credit (or whatever). Anyone knows how this works? |
![]() | ![]() |
![]() | #41 | |
BHPian ![]() Join Date: Jan 2015 Location: Bangalore
Posts: 81
Thanked: 54 Times
| ![]() Quote:
Is there any clarity if the cess is also deducted to arrive at ex-factory cost? Else when we pay the lease rentals we will be paying cess extra and hence overall cost of leasing a car becomes costlier compared to pre-gst lease renting. Need to check from people from my company who have leased post gst for such cars like Innova | |
![]() |
![]() | #42 | |
BHPian Join Date: Sep 2010 Location: Bangalore
Posts: 96
Thanked: 988 Times
| ![]() Quote:
It would be interesting to see the post-GST calculations published by the companies. My company hasn't yet. | |
![]() |
![]() | #43 |
Team-BHP Support ![]() ![]() Join Date: Apr 2007 Location: Delhi
Posts: 8,571
Thanked: 8,530 Times
| ![]() My rental has gone up from 32058 to 40525 ![]() This is for a 10.8 lakh loan for three years |
![]() |
![]() | #44 |
BHPian Join Date: Apr 2008 Location: BAngalore
Posts: 98
Thanked: 56 Times
| ![]() Mine is up from INR 38,656 to INR 48,278 i.e an increase of INR 9,622 per month. This was for the XUV500 W8 Auto for a 4 year lease car plan ![]() |
![]() |
![]() | #45 | |
Senior - BHPian ![]() Join Date: Jan 2014 Location: Bangalore
Posts: 1,452
Thanked: 2,978 Times
| ![]() Quote:
| |
![]() |