Nature of expenditure

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karteek madhvan (Querist)
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26 June 2012 For office use we taken one building premises for lease for 30 years and the full amount of lease paid as advance.
to write off those amount for every financial year up to 30 years to the lease hold expenses.

1. to treat nature of expenditure the amount as capital or revenue ?

2. to write of the advance, if it is revenue the balance amount is shown as every year up to 30 years as advance ?
3. what is procedure to be followed.if capital depreciation is considerable

Soumitra Basu

Soumitra Basu (Expert)
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27 June 2012 The amount should be treated as Lease Hold building under the head Fixed Assets. Proportionate amount shall be written off as depreciation during the entire 30 years.

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