Hi All,
A Director incurred Rs.30,000/- for formation of Company.paid to CA.
How to record in the books of Accounts and how to write-off as per companies act,2013
Thanks
12 Replies
ANKUR TAH
(Teacher Consultant and CA finalist.)
(543 Points)
Replied 29 September 2016
As per sec 35D expenditure incurred before the commencement of his business can be possible to treat as preliminary exp.
In your case CA fees can be treated as feasibility report or project report.
Than this amount should be write off on 5 successive years.
In your case CA fees can be treated as feasibility report or project report.
Than this amount should be write off on 5 successive years.
Rahul Shah
(Assistant Chartered Accountant)
(196 Points)
Replied 29 September 2016
As per the Latest Companie act 2013 All Preliminary Expenenses Should be Writeoff 100 % in same Year. However 1/5 Can be Claimed as per Income tax Act u/s 35D
ANKUR TAH
(Teacher Consultant and CA finalist.)
(543 Points)
Replied 29 September 2016
yes, Mr Rahul define properly.
Ashwin N
(Chartered Accountant)
(192 Points)
Replied 29 September 2016
means show it as legal & professional expenses .what will be the entry.
Professional Expenses A/c .............Dr.
credit .............which account ?
Thanks
Ashwin N
(Chartered Accountant)
(192 Points)
Replied 29 September 2016
whether show it as loan from director.
thanks
CA PALLAVI GUPTA
(Professional)
(592 Points)
Replied 29 September 2016
Preliminary Exp A/c Dr
To Bank/ Party"s name
To Bank/ Party"s name
Ashwin N
(Chartered Accountant)
(192 Points)
Replied 29 September 2016
whether it can shown as loan from director,since director has paid it from his pocket.
CA PALLAVI GUPTA
(Professional)
(592 Points)
Replied 29 September 2016
In such case... one more entry for the loan amount shall be made....
Bank Dr 30
To Loan from Director 30
Preliminary Exp Dr 30
To Bank 30
Bank Dr 30
To Loan from Director 30
Preliminary Exp Dr 30
To Bank 30
Ashwin N
(Chartered Accountant)
(192 Points)
Replied 04 October 2016
Whether it to be shown
1.Payment to Auditor or
2.to be shown in Legal & Professional fees
in other expenses
CA Tanvi Sheth
(Consultant)
(232 Points)
Replied 04 October 2016
Hello,
For passing journal entry, just pass entry as:
Preliminary exp dr.
to loan from director's
In narration mention that the expense pertain to Auditor's fee for reports.
Also see to the fact that these expense will attract deferred tax, as treatment in books and tax will defer.
Then for next five yrs pass entry as:
Preliminary exp written off
To Preliminary exp
CA Tanvi Sheth
(Consultant)
(232 Points)
Replied 04 October 2016
Hello,
For passing journal entry, just pass entry as:
Preliminary exp dr.
to loan from director's
In narration mention that the expense pertain to Auditor's fee for reports.
Also see to the fact that these expense will attract deferred tax, as treatment in books and tax will defer.
Then for next five yrs pass entry as:
Preliminary exp written off
To Preliminary exp
CA Tanvi Sheth
(Consultant)
(232 Points)
Replied 04 October 2016
Hello,
For passing journal entry, just pass entry as:
Preliminary exp dr.
to loan from director's
In narration mention that the expense pertain to Auditor's fee for reports.
Also see to the fact that these expense will attract deferred tax, as treatment in books and tax will defer.
Then for next five yrs pass entry as:
Preliminary exp written off
To Preliminary exp.
Show it on asset side of Balance sheet and the writtten off amount in P&L.
Recent Topics
- Share office desk in bkc, near family court
- 80D claim for payment paid by parent
- TDS on purchase of Flat under subvention scheme be
- Nznxnc call me at the end of the day of the
- Nsje snswk fjw ed le ene djff ne enje ejdd rejje
- Hxjcif the day I have been in touch with me and
- Iska djd djrbdsjebshe sir ur rei ejr reinr the jr
- GST registration for medical shop in Karnataka
- Hsshs me know if you are free number of the
- Chu Kang and the situation of the situation and I
Related Threads
CAclubindia
