Please Help: Revenue exp. Or capital exp.
Posted Date : 11-Jul-2011 , 03:20:29 pm | Posted By TUSHAR
Mr X is a practing CA and purchase a software of TALLY on 30/6/2011 and install the software in his computer. He starts using the software from 1st April 2012. Discuss the depreciation allowed to Mr. X in view of PGBP...
Category : Income Tax | Answers : 6 | Comments : 4 | Hits : 1427
Answers
Answer By: PRIYANKA
Yes , this would be treated as revenue expenditure and taken to p&l A/c, point of deprectiation does not arise.
Answer By: CA. Sachin Data
It is non- capital expenditure hence no depeciation allowed.
Answer By: CA. Sachin Data
Software is a tangible asset having a limited life as it gets obsolete due to technical changes. Hence, it is a item of revenue expenditure.
Answer By: CA VIKAS JAIN
this should be charged against revenue and not be capitalised. further more the expense to be capitalised, the monetory limit of expenditur should be considered. for example instead of tally suppose the case will be installing a SAP then that expenditure certainly be capitalised.
Answer By: CA Richa Gupta
This expense is inccured for his operations that y this vl b charged as revenue exp. no dep will be calculated on that amt.
Answer By: Vikash Kumar Jha
You have not explain monetary value and duration rlated to software. Because it will be important aspect to judge wether it will be capitalise or not. Without specific information you can take it as a revenu expenditure.
Comments
Saurabh Mittal
11-Jul-2011 , 05:11:26 pmas per recent case of supreme court software purchase treated as revenue expenditure not a capital expenditure so not possible for claiming depreciation on tally software.
Saurabh Mittal
11-Jul-2011 , 05:11:26 pmas per recent case of supreme court software purchase treated as revenue expenditure not a capital expenditure so not possible for claiming depreciation on tally software.
PRIYANKA
12-Jul-2011 , 05:22:09 pmYes , this would be treated as revenue expenditure and taken to p&l A/c, point of deprectiation does not arise.
CA. Sachin Data
12-Jul-2011 , 05:45:19 pmSoftware is a tangible asset having a limited life as it gets obsolete due to technical changes. Hence, it is a item of revenue expenditure.