Betterment charges
This query is : Resolved
27 August 2024
Hello,
I have paid total 50 lakh rs for sanctioning building plan. My query is will these charges come under capital expenditure or revenue expenditure. And can i show as a expense in income tax return
I have paid total 50 lakh rs for sanctioning building plan. My query is will these charges come under capital expenditure or revenue expenditure. And can i show as a expense in income tax return
27 August 2024
Yes, it is capitalized in the cost of building.
10 September 2024
Sir can you please elaborate means it will be taken as expense or not
10 September 2024
It is capital expenditure and not revenue expense.
26 September 2024
I am constructing building and planning to sell all the flats built on land. Now my question is all the expense like land cost and plan sanction charges are taken in WIP and same can be deducted from income after selling all the flats since I am not keeping them on my name
26 September 2024
You have not mentioned that it is your business. It differs for person to person.
26 September 2024
Yes it's my business since I am using land as stock in trade in AOP which contains my family members only(Parents and brother). And am I doing all the expenses on the name of AOP i.e from current account of AOP.
26 September 2024
In that case all the expenses, fees, charges related to building construction, be administrative or technical will be revenue expenses debited to P& L account.
30 November 2024
Thank you sir clarifying all my doubts. One last question since land was taken on individual members name after that we formed AOP and moved the land to AOP with the same cost at which it was purchased by us.Still do we need to show it in individual ITR since no capital gain has raised.
30 November 2024
It is debatable issue. Under whose name the documents were registered? How the payment was made to seller? Whether the land got transferred legally to AOP? What is the roll of developer etc. etc. If you can justify your action to assessing officer then everything OK.
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