One Day, One Minute, One Rule – 111.
Eligibility of Input Tax Credit (ITC) for Hotel Stays During Official Tours
111. According to Letter No. PA/Accounts-II/GST-Punjab/2024-25 (Part)/232-277 dated 10.12.2025, what are the specific conditions for claiming Input Tax Credit (ITC) on CGST/SGST paid for hotel accommodation during official tours?
As per the Ministry of Communications, Department of Posts Letter No. PA/Accounts-II/GST-Punjab/2024-25 (Part)/232-277 dated 10.12.2025, it is clarified that Input Tax Credit (ITC) on CGST/SGST charged on hotel bills is admissible only when both the supplier (hotel) and the recipient (Department/Office) are registered under GST in the same State. If an officer travels to another state and stays in a hotel located there, ITC cannot be claimed because the hotel is not in the same state as the recipient's GST registration. Cross-state CGST/SGST is explicitly not creditable.
To address this and improve tax efficiency under the "One State One GSTIN" policy, it is now crucial to provide the correct state-specific GSTIN at the time of hotel booking. The GSTIN corresponding to the state in which the official is traveling should be furnished to ensure that ITC on hotel expenses is fully claimable. This practice is intended to reduce overall costs to the Department by ensuring tax efficiency across PAN India through the Taxation Module in IT 2.0.
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