Capitalisation during construction period
This query is : Resolved
Jigar Chudasama
(Querist)
20 August 2012
Expenses related to the construction of as Asset is capitalised during construction period, what if I earn Interest income from the surplus fund parked in bank or money market instruments????
whether it has to be reduced from my cost of asset (net of tax) ???
whether it has to be reduced from my cost of asset (net of tax) ???
CA Ayush Agarwal
(Expert)
20 August 2012
how you can relate surplus fund from construction.
i mean surplus funds you are getting from where.
if u r capitalising the interest on fund and also getting interest then u must reduced from construction cost
i mean surplus funds you are getting from where.
if u r capitalising the interest on fund and also getting interest then u must reduced from construction cost
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Jigar Chudasama
(Querist)
20 August 2012
Actually this funds have come from the loan taken for construction of asset. Amount of loan has not been fully utilized so from the surplus fund company has made investment and company has earn interest on the same.
now by what amount cost of assets is to be reduced means gross interest amount or net interest amount after paying income tax gross interest amount???
now by what amount cost of assets is to be reduced means gross interest amount or net interest amount after paying income tax gross interest amount???
CA Ayush Agarwal
(Expert)
20 August 2012
avoid income tax in this case.
if ur assuming income tax then xonsider in both i mean adding and reducing.
if ur assuming income tax then xonsider in both i mean adding and reducing.
Jigar Chudasama
(Querist)
20 August 2012
assuming at the time adding??
sir didn't got u.
sir didn't got u.
CA Ayush Agarwal
(Expert)
20 August 2012
I Mean If You are Considering Income Tax, Then Consider in Both Aspect.
Adding & Reducing Both Cases of Interest.
Adding & Reducing Both Cases of Interest.
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