Is depreciation allowable on purchase of fixed assets by cash, Which used for bussiness purpose?

-
Image
 Yes!, depreciation is allowable on purchase of asset for business purpose by cash, subject to certain conditions. The asset must be used for the business or profession of the assessee, and it must be owned, wholly or partly, by the assessee. The asset must also have a useful life of more than one year. However, there is a restriction on claiming depreciation on assets purchased in cash. Section 43 of the Income Tax Act, 1961, disallows the capital expenditure incurred in cash for certain specified assets, including fixed assets. This means that if you purchase an asset for your business in cash, you will not be able to claim depreciation on the cost of the asset. There are a few exceptions to this rule. For example, you will still be able to claim depreciation on assets purchased in cash if the amount of the expenditure does not exceed Rs. 20,000. You will also be able to claim depreciation on assets purchased in cash if the asset is used for scientific research or for the purpos...
Post a Comment

KEY HIGHLIGHTS OF INDIAN UNION BUDGET 2023-2024 : PERSONAL INCOME TAX ASPECTS

-

Five major announcement made by the hon'ble finance minister of India Smt. Nirmala Sitharaman during the union budget presented at parliament are as follows: For Middle Class People


* Following changes is applicable only for the person, who opting new tax regime U/s. 115BAC (1A) 

✓ Increase Limit of Rebate U/s. 87(A) : Under New Tax Regime 

Resident individual with total income up to ₹. 5,00,000 do not pay any tax due to rebate under both old and new regime. It is proposed to increase the rebate for the resident individual under the new regime so that they do not pay tax if their total income is up to ₹. 7,00,000.


✓ Changes in Tax Slab system opted U/s. 115BAC(1A) : Under New Tax Regime 


Substantial relief is proposed under the new regime with new slabs and tax rates as under:


Total Income (₹)                           Rate (per cent)

 • Upto 3,00,000                                        Nil


• From 3,00,001 to 6,00,000                    5%


 • From 6,00,001 to 9,00,000                   10%


• From 9,00,001 to 12,00,000.                 15%


• From 12,00,001 to 15,00,000                20% 


• Above 15,00,000                                     30%


✓  Standard Deduction U/s. 16(ia) : Benefits to salaried class and the pensioners including family pensioners

 Extending the benefit of standard deduction to the new tax regime. Each salaried person with an income of ₹.15.5 lakh or more will thus stand to benefit by ₹. 52,500.


✓ Change in Surcharge: 

  Reduction in highest surcharge rate from 37 per cent to 25 per cent in the new tax regime. This would result in reduction of the maximum tax rate to 39 per cent.


✓ Increase Limit under Leave Encashment: 

  Encashment of earned leave up to 10 months of average salary, at the time of retirement in case of an employee (other than an employee of the Central Government or State Government), is exempt under sub-clause (ii) of clause (10AA) of section 10 of the Income-tax Act (“the Act”) to the extent notified. The maximum amount which can be exempted is ₹. 3 lakh at present. It is proposed to issue notification to extend this limit to ₹. 25 lakh. 


✓ The new tax regime for Individual and HUF, introduced by the Finance Act 2020, is now proposed to be the default regime. 


This regime would also become the default regime for AOP (other than co-operative), BOI and AJP. 


Any individual, HUF, AOP (other than co-operative), BOI or AJP not willing to be taxed under this new regime can opt to be taxed under the old regime. For those person having income under the head “profit and gains of business or profession” and having opted for old regime can revoke that option only once and after that they will continue to be taxed under the new regime. For those not having income under the head “profit and gains of business or profession”, option for old regime may be exercised in each year.



Conclusion: Finance Minister Nirmala Sitharaman has presented the last full budget of the second term of the Modi government today. It was hoped that the middle class people would get a big relief in this budget. However, this time too this hope has been dashed. When Nirmala Sitharaman announced in her budget speech that there would be no tax on income up to seven lakhs, the MPs greeted her with a clap on the benches, but when Nirmala Sitharaman said that this concession would be available only in the new tax structure, there was silence. Whatever relief Nirmala Sitharaman has given in income tax, it is only given in the new tax structure, if you are paying your income tax according to the old tax structure, then there is nothing for you in this budget.

 

Comments

Post a Comment

Popular posts from this blog

Happy Navratri 2020 Highlights : Navratri Started from Today (17th October,2020) , It's Start and End Date, Significance, Best wishes and images

-
Image
  Happy Navratri 2020 Highlights : Navratri Started from Today (17th October,2020) , It's Start and End Date, Significance, Best wishes and images "I HOPE THAT MAA DURGA GOT VICTORY ON PANDEMIC CORONAVIRUS." India is a country of varied cultures and traditions. Navratri means group of one-night, which is special for all hindusiam. A nine-day Hindu festival that falls in the month of autumn, Navratri is dedicated to the different forms of Goddess Durga. Devotees worship nine avatars of the Goddess during these nine days. A nine-day Hindu festival that falls in the month of autumn, Navratri is dedicated to the different forms of Goddess Durga.Devotees  worship nine avatars of the Goddess during these nine days. Navratri is the sign of goods over evil. Navratri is celebrated during the Hindu calendar month of Ashvin, which usually falls in the Gregorian months of September and October. In 2020, the festival of Navratri will start on 17 October and will go on till 25 October....
Read more