TAX IMPLICATIONS ON SOFTWARE PURCHASE

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alifiya (Querist)
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14 June 2011 OUR CLIENT HAS PURCHASED A SOFTWARE ON WHICH MAHARASHTRA SALES TAX AND SERVICE TAX IS CHARGED
PLS TEELL THE TAX IMPLICATIONS OF THE ABOVE PURCHASE OF SOFTWARE

ABHISEK TOSNIWAL

ABHISEK TOSNIWAL (Expert)
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14 June 2011 In your case you have to capitalise the purchse amount of software as per AS 26.If you do not avail any input credit for sales tax and service tax, then you need to capitalise the software for the full amount including taxes.

Regards
Abhisek Tosniwal

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alifiya

alifiya (Querist)
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14 June 2011 and while making the payment for the above software should we make the full payment ???

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ABHISEK TOSNIWAL

ABHISEK TOSNIWAL (Expert)
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14 June 2011 Yes,When you need to make the full payment,then only you can capitalise the full amount.

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