Preliminary Expenses not W/Off
This query is : Resolved
29 February 2020
One party had preliminary exp in 2015-16 which was shown in Asset in balance sheet in that financial year and till now i.e. upto financial year 2018-19 that expenses were shown in asset side of balance sheet . If party wants to w/off in financial year 2019-20 then what is the treatment to w/off that preliminary expenses? Please explain the treatment in Accounts and provision as per income tax .
29 February 2020
+ Can be w/off in accounts of FY 2019-20 with the support of a 'resolution'.
+ Pl see section 35D for income tax act.1961.
+ Pl see section 35D for income tax act.1961.
29 February 2020
As per AS 22 preliminary expenses should be debited to P/L in same year . You may debit it in current year but that will be treated as prior period item and disclosures regarding prior period item should be provided
And as per Section 35D of IT Act, the preliminary expenses should be amortised in five financial years beginning from the year of commencement of business or the extension of the undertaking is completed or the new unit commences production or operation as the case may be and the maximum limit of Expenses allowed is 5% of capital employed please check explanation under 35D for calculation of capital employed
And as per Section 35D of IT Act, the preliminary expenses should be amortised in five financial years beginning from the year of commencement of business or the extension of the undertaking is completed or the new unit commences production or operation as the case may be and the maximum limit of Expenses allowed is 5% of capital employed please check explanation under 35D for calculation of capital employed
29 February 2020
So can we w/off full amount in P&L of Financial year 2019-20 and what will be treatment as per 35D of income Tax ? As per 35 D we can w/off 1/5 th in every year but it was not w/off in past years and Financial year 2019-20 is 5th Year. Please tell me the treatment.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- REGARDING GST ON COMMERICIAL PROPERTY
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- GST on export of services and Input Credit
- TDS U/S. 194NF
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- Applicable TDS rate for sale of property in Nov 2024
- Should I report my US salary for January, February, March in Schedule FA?
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- Regarding Resignation by Auditor from Pvt. Ltd.
Trending Online Classes
CAclubindia
