10 April 2019
Respected sir we have developed app for payment & discount purpose for that we have incorporated business in dec month we have appointed it team of 7 person & paid salary for oct & nov month i want to know whether salary for oct & nov month will be allowed as deduction as preliminary exp or it will not be allowed in income tax
10 April 2019
Yes the same can be treated as preliminary expenses or can be capitalised with a particular asset if we can identify the particular asset for which the expenditure was carried out.
After the commencement of business, the preliminary expenses can be written off over the next five years under the income tax act. However under accounting terms the entire amount will be treated as an expenses in the said year of commencement of business.
The said 1/5th of the expenditure will be allowed as an admissible expenses u/s 35AD of the Income Tax Act, 1961.
10 April 2019
If the salary has been paid towards developing the computer application meant for in-house use , then transfer the expenses to computer application account. Pl refer AS 26 -Intangible Assets.
10 April 2019
we are LLP & not company It team has developed one application like flipkart available in market then how to treat salary of oct & nov month? our LLP has incorporated on 01.12.2018 but i want to know about salary of oct & nov month?
CAclubindia
