will additional depriciation be allowed on eligible plant and machinary if closing wdv of the block is nil?
will additional depriciation be allowed on eligible plant and machinary if closing wdv of the block is nil?
Enhanced/Additional depreciation is allowed even the WDV of block of assets in NIL but it should be claimed only one time.
WDV of asset can never be less than Zero. In the given case if additional depreciation would be allowed as a result the WDV will go below zero.
no it can't be allowed if wdv is zero
| Originally posted by : CA Saiyum khan | ||
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WDV of asset can never be less than Zero. In the given case if additional depreciation would be allowed as a result the WDV will go below zero. |
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yes agreed
additional depreciation would be allowed as a result the WDV will go below zero. and Wdv can never below Zero.
Agreed
thanks for the reply ..but dont you all think that additinal depriciation can be claimed in the next year?
Sir,
Kindly let me know the rate of roller Depreciation used in Aluminum Rolling mill. Since the rate of Iron and steel industry is 80 % in Rolling mill rolls as per Income Tax act. But the rate of Aluminum Rolling Mills Roller is not specified in the Income tax act.
So please let me know at an earliest.
Thanking you.
Regards
Sunil Gattani
C/o.Jai Bajrangbali Aluminum Products
A.T.Road Jorhat -785001 (Assam)
Cell No : 94350-51992
"WDV of asset can never be less than Zero. In the given case if additional depreciation would be allowed as a result the WDV will go below zero."
Yes i also agreed
Q. Will additional depriciation be allowed on eligible plant and machinary if closing wdv of the block is nil?
Reply- The closing WDV can be Nil in the following circumstances -
1. Balance as on 1.4.2010 .......4000
2. Addition .................................15000 (Asset eligible for Additional Depreciation @ 20%)
3. Total........................................19000
4. Sales/ Deletion ......................19000 (old Asset Sold for 19000 )
5. Balance ........... 0
The Value of Block is 0 ,
We can't provide normal depreciation and -.....if can provide it will be 0.
We can't skip any of the above steps so as to insert Additional Depreciation in between No. 1 to 5.
First we have to provide Normal Depreciation.
Additional Depreciation can be claimed @ 20% of WDV and .....that will also be 0.
Only 0 can be deducted from 0 for not getting a negative WDV.
Here Section 50 will also not help as the loss is not due to Sale or transfer.
Additional Depreciation is not calculated on WDV. it is calculated directly from cost of Plant and Machinery @ 20%.
Hi Pankaj
Additional depreciation is computed on individual asset and not on the block of asset, so I think additional depreciation will be allowed even if the block reduced to Nil.
But if the new plant & machinary is sold in the year of acquisition, then additional depreciation will not be allowed in that case.
Plz refer the link
CAclubindia
