Gift

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sumit jain (Querist)
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30 September 2011 Suppose i received a building as gift..
Do i need to show it in my Balance sheet..
If yes then at what value..

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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30 September 2011 Yes, you need to show the building in your books.

You can take the fair market value of the building as the cost.

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CMA KNVV Sri Vidya - Sri Kanth

CMA KNVV Sri Vidya - Sri Kanth (Expert)
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30 September 2011 Agree with Expert

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sumit jain

sumit jain (Querist)
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01 October 2011 sir
what shall be the entry to be entered in accounts

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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01 October 2011 No you are required to show the same as at nominal value no need to value it at cost as you have not paid anything for it

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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01 October 2011 well, if the building is received as part of business gift then in such case, it should be reorded at Income and measured at fair value of market

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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01 October 2011 The netry in both the cases will be
Building A/c DR
To P/L A/c

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sumit jain

sumit jain (Querist)
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02 October 2011 I think that the entry should be:
Building A/c DR
To Capital A/c
(With the cost of previous owner)

Bcoz if we pass the entry through profit & loss account the its value will increase my profit..

Please share your opinion on this..

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CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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03 October 2011 The entry will be as under:

Building A/c Dr.
To Gift Received (Income)

Gift received will go to P&L, but for income tax purpose, it will be taxed under Income from Other Sources and not Business Income.

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Gift

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