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Capitalization of ground rent and conversion charges

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(Querist)
04 March 2020 whether ground rent and conversion charges of building required to be capitalized?
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VIJAY KUMAR

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VIJAY KUMAR (Expert)
05 March 2020 Conversion charges from leasehold to freehold are treated as improvement cost and thus should be capitalised but ground rent paid is to be treated revenue item.
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CA Parul Saxena

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CA Parul Saxena (Querist)
05 March 2020 what is ground rent exactly?
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VIJAY KUMAR

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VIJAY KUMAR (Expert)
05 March 2020 as far as I know It is simply rent, mainly for the vacant plots.. like rent from parking lots or from oil bunks etc.

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