Soaring High with GST: A Comprehensive Guide to Taxes on Helicopter Purchases in India
Owning a helicopter is a symbol of ultimate luxury and utility. But before you embark on this exciting journey, it’s crucial to understand the tax implications involved in purchasing one in India. This blog post dives deep into the Goods and Services Tax (GST) levied on helicopter purchases, helping you make informed decisions.
Demystifying GST Rates: Understanding the Distinction
The GST rate applicable to your helicopter purchase hinges on its intended use:
- Non-Personal Use (Commercial Operations): If you plan to utilize the helicopter for commercial purposes, such as charter services, air ambulance operations, or aerial photography, you’ll benefit from a 5% GST rate. This falls under the HSN code 8802, encompassing “Other aircraft (for example, helicopters, aeroplanes); spacecraft (including satellites) and suborbital and spacecraft launch vehicles.”
- Personal Use: Owning a helicopter for private enjoyment or leisure activities attracts a significantly higher 28% GST rate, along with a 3% compensation cess (effectively amounting to 30.1% tax). This also falls under HSN code 8802.
Key Considerations and Documentation Requirements
- Defining Intended Use: Clearly establish the primary purpose for purchasing the helicopter. Documentation like business registration, operational licenses, or service contracts for commercial use can be crucial in securing the lower 5% GST rate.
- Consulting a Tax Professional: Navigating tax regulations can be complex. Consulting a qualified tax professional is highly recommended. They can guide you through the specific documentation required to qualify for the lower GST rate and ensure compliance with all tax regulations.
HSN Codes
GST Rates & HSN Code for Instruments of Medical, Chemical & Astronomy – Apparatus, Binoculars & Others – Chapter 90
| HSN Code | Description | Rate (%) | CESS (%) | Effective Date | Rate Revision |
|---|---|---|---|---|---|
| 8801 | BALLOONS AND DIRIGIBLES, GLIDERS, HAND GLIDERS AND OTHER NON-POWERED AIRCRAFT | 18% | 01/07/2017 | ||
| 880100 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT | 18% | 01/07/2017 | ||
| 88010010 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT -BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT:— GLIDERS AND HANG GLIDERS | 18% | 01/07/2017 | ||
| 88010020 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT-BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT: –BALLOONS | 18% | 01/07/2017 | ||
| 88010090 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT-BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT:—OTHER | 18% | 01/07/2017 | ||
| 88011000 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT GLIDERS AND HANG GLIDERS | 18% | 01/07/2017 | ||
| 88019010 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT – OTHER: BALLOONS | 18% | 01/07/2017 | ||
| 88019090 | BALLOONS AND DIRIGIBLES; GLIDERS, HANG GLIDERS AND OTHER NON-POWERED AIRCRAFT – OTHER: OTHER | 18% | 01/07/2017 | ||
| 8802 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES – HELICOPTER | 5% | 3% | 01/07/2017 | |
| 8802 | Aircrafts for personal use | 28% | 01/07/2017 | ||
| 88021100 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES – HELICOPTERS: OF AN UNLADEN WEIGHT NOT EXCEEDING 2,000 KG | 5% | 3% | 01/07/2017 | |
| 88021200 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES – HELICOPTERS: OF AN UNLADEN WEIGHT EXCEEDING 2,000 KG | 5% | 3% | 01/07/2017 | |
| 88022000 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES AEROPLANES AND OTHER AIRCRAFT, OF AN UNLADEN WEIGHT NOT EXCEEDING 2,000 KG | 5% | 3% | 01/07/2017 | |
| 88023000 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES AEROPLANES AND OTHER AIRCRAFT, OF AN UNLADEN WEIGHT EXCEEDING 2,000 KG BUT NOT EXCEEDING 15,000 KG | 5% | 3% | 01/07/2017 | |
| 88024000 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES AEROPLANES AND OTHER AIRCRAFT, OF AN UNLADEN WEIGHT EXCEEDING 15,000 KG | 5% | 3% | 01/07/2017 | |
| 88026000 | OTHER AIRCRAFT (FOR EXAMPLE, HELICOPTERS, AEROPLANES); SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES SPACECRAFT (INCLUDING SATELLITES) AND SUBORBITAL AND SPACECRAFT LAUNCH VEHICLES | 0% | 3% | 01/07/2017 | |
| 8803 | PARTS OF GOODS OF HEADING 8801 OR 8802 | 5% | 01/07/2017 | ||
| 8803 | PARTS OF GOODS OF HEADING 8801 OR 8802 | 0% | 01/07/2017 | ||
| 88031000 | PARTS OF GOODS OF HEADING 8801 OR 8802 – – PROPELLERS AND ROTORS AND PARTS THEREOF | 5% | 01/07/2017 | ||
| 88032000 | PARTS OF GOODS OF HEADING 8801 OR 8802 – – UNDER-CARRIAGES AND PARTS THEREOF | 5% | 01/07/2017 | ||
| 88033000 | PARTS OF GOODS OF HEADING 8801 OR 8802 – – OTHER PARTS OF AEROPLANES OR HELICOPTERS | 5% | 01/07/2017 | ||
| 88039000 | PARTS OF GOODS OF HEADING 8801 OR 8802 – OTHER | 5% | 01/07/2017 | ||
| 8804 | PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO | 18% | 01/07/2017 | ||
| 880400 | PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO | 18% | 01/07/2017 | ||
| 88040010 | PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO – PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO: PARACHUTES (INCLUDING DI | 18% | 01/07/2017 | ||
| 88040020 | PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO – PARACHUTES (INCLUDING DIRIGIBLE PARACHUTES AND PARAGLIDERS) AND ROTOCHUTES; PARTS THEREOF AND ACCESSORIES THERETO: ROTOCHUTES; PARTS AND AC | 18% | 01/07/2017 | ||
| 8805 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES | 18% | 01/07/2017 | ||
| 880510 | AIRCRAFT LAUNCHING GEAR AND PARTS THEREOF; DECK ARRESTOR OR SIMILAR GEAR AND PARTS THEREOF | 18% | 01/07/2017 | ||
| 88051010 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES – AIRCRAFT LAUNCHING GEAR AND PARTS THEREOF; DECK ARRESTOR OR SIMILAR GEAR AND PARTS THEREOF: AIRCRAFT LAUNCHING GEAR | 18% | 01/07/2017 | ||
| 88051020 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES – AIRCRAFT LAUNCHING GEAR AND PARTS THEREOF; DECK ARRESTOR OR SIMILAR GEAR AND PARTS THEREOF: DECK ARRESTOR OR SIMILAR GEAR | 18% | 01/07/2017 | ||
| 88051030 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES – AIRCRAFT LAUNCHING GEAR AND PARTS THEREOF; DECK ARRESTOR OR SIMILAR GEAR AND PARTS THEREOF: PART OF AIRCRAFT LAUNCHING GEAR AND DECK-ARRESTOR | 18% | 01/07/2017 | ||
| 88052100 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES – GROUND FLYING TRAINERS AND PARTS THEREOF: AIR COMBAT SIMULATORS AND PARTS THEREOF | 18% | 01/07/2017 | ||
| 88052900 | AIRCRAFT LAUNCHING GEAR; DECK-ARRESTOR OR SIMILAR GEAR; GROUND FLYING TRAINERS; PARTS OF THE FOREGOING ARTICLES – GROUND FLYING TRAINERS AND PARTS THEREOF: OTHER | 18% | 01/07/2017 |
Disclaimer:Rates given above are updated up to the GST (Rate) notification no. 05/2020 dated 16th October 2020 to the best of our information. We have sourced the HSN code information from the master codes published on the NIC’s GST e-Invoice system. There may be variations due to updates by the government. Kindly note that we are not responsible for any wrong information. If you need information about the “Effective Date” for every GST or cess rates, then please visit the CBIC website.
Additional Points to Remember
- State-Specific Variations: While the central GST rate applies throughout India, some states might impose additional taxes on luxury goods. Research any potential state-specific levies before finalizing the purchase.
- GST on Maintenance and Services: Remember that GST is also applicable on maintenance services, parts, and other helicopter-related expenses. Understanding the GST implications for these ongoing costs is essential for budgeting purposes.
Beyond GST: Exploring Other Considerations
- Import Duties: If you’re purchasing a helicopter from abroad, customs duties may apply in addition to GST. Understanding these additional charges is crucial for accurate cost estimation.
- Registration and Permits: Owning a helicopter necessitates obtaining specific registrations and permits from aviation authorities. Research the necessary licenses and approvals to ensure legal and safe operation.
Conclusion: Planning for a Smooth Takeoff
Purchasing a helicopter is a significant investment. By understanding the GST implications and seeking guidance from tax experts, you can ensure a smooth and financially informed journey towards owning your very own piece of the sky. Remember, meticulous planning and adherence to regulations are key to a successful and enjoyable helicopter ownership experience.
Disclaimer: This blog post is intended for informational purposes only and does not constitute tax advice. It’s advisable to consult with a tax professional for guidance specific to your situation.
CA, CWM (AAFM-US), CBV, CIFRS, R-ID, B.COM (H), RV* (IBBI)
He is Fellow Chartered Accountant with more than 14 Years of Experience & Qualified Chartered Wealth Manager from AAFM (USA) and Registered Independent Director with IICA (MCA). He has been Published in several media interviews and articles with esteemed forums like Zee News, NDTV India, Hindustan Times, ET, TIOL, Taxmann, Taxguru, Caclubindia. He Can be reached at ankit@gravita.in
He Specialises in Virtual CFO Services. He is Also assists Startups, SME’s & Corporates to Secure Funding and Handholds them through the Routine Business complexities.
