income tax
Prazu Shrestha (36 Points)
20 September 2018
is foreign exchange gain or loss allowed in calculation of taxable income
1 Replies
Ankur Jalan
(Article Assistant )
(345 Points)
Replied 20 September 2018
forex gain or loss-
if its in revenue nature then it will be taxed under pgbp income and similarly it will be allowed as expense u/s 37(1)
if it in capital nature then no treatment(i.e. capital receipt in case of income and capital loss in case of loss)
An exception is there to the above rule is Sec.43A i.e. any forex gain or loss w.r.t. capital asset purchased will be adjusted to the WDV of the asset in the year of payment.
P.S. - in case claiming an expense w.r.t. revenue nature of forex loss one should follow accural basis(woodward governor india pvt ltd vs.cit)
if its in revenue nature then it will be taxed under pgbp income and similarly it will be allowed as expense u/s 37(1)
if it in capital nature then no treatment(i.e. capital receipt in case of income and capital loss in case of loss)
An exception is there to the above rule is Sec.43A i.e. any forex gain or loss w.r.t. capital asset purchased will be adjusted to the WDV of the asset in the year of payment.
P.S. - in case claiming an expense w.r.t. revenue nature of forex loss one should follow accural basis(woodward governor india pvt ltd vs.cit)
Recent Topics
- CLAIMING OF U CLAIMED RCM
- Building construction works
- REGARDING GSTR-9 F.Y 2023-24
- Rectification to decrease income in SCHEDULE OS
- Can Statutory Auditor of a subsidiary become concu
- Client Asking for the Revised Invoice
- Share office desk in bkc, near family court
- 80D claim for payment paid by parent
- TDS on purchase of Flat under subvention scheme be
- GST registration for medical shop in Karnataka
Related Threads
CAclubindia
