Advt Expenses

This query is : Resolved

Gopalakrishnan V (Querist)
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17 April 2025 Huge expenditure spent on advertisement for opening a new branch, can it be shown as deferred revenue expenditure, as the benefit of spending will be spread over years?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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18 April 2025 Earlier, companies could defer large advertisement expenses over 3-5 years if they provided long-term benefits.
However, post-Ind AS adoption, this practice is no longer permissible unless it meets the asset recognition criteria.

Income Tax Act does not allow deferral of advertisement expenses (Section 37 treats it as revenue expenditure).
Any deferred claim may be disallowed during tax assessments.