12 September 2013
We are a partnership firm maintaining accounts on CASH BASIS. we purchased certain fixed assets ON CREDIT during FY 2012-13 & put to used during the same period. we have made the payment during FY 2013-14. What would be the treatment of Fixed Assets during FY 2012-13 in our books and whether we claim depreciation on these fixed assets while calculating income for PY 2012-13?
12 September 2013
allowance for depreciation is not based on the payment for the same. As long as the asset has been put to use, the depreciation on the same can be claimed. So please do claim depreciation for PF 2012-13
Querist :
Anonymous
Querist :
Anonymous
(Querist)
12 September 2013
Sir, we are following CASH basis of accounting & not Accrual basis.
12 September 2013
claim for depreciation, as i said before, is not based on cash part of the transaction. irrespective of whether you do accounting on cash or accrual basis, deprecation claim shall be based on the income tax act.
Though you may not pass any entry in the books of accounts for the same.