Depreciation

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Shailaja.G.C

Shailaja.G.C (Querist)
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11 May 2009 Hi. Pls clarify this query.

In the rates of depreciation chart as per IT Rules, under BUILDING:
1) Its given that on "Building which are used mainly for residential purposes except hotels & boarding houses can claim depr. at 5 percent.

So does that mean a Business owner can claim depreciation on his residential property(specifically on ground flr house, and where the 1st flr is used as office premises & claims depr. thereon. Can he debit the same to P & L Account.

CA Tilak Raj Sharma

CA Tilak Raj Sharma (Expert)
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11 May 2009 Yes, depreciation can be claimed if buiding has been be shown in the accounts as Fixed Assets.

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CA Nitin Wadhwani

CA Nitin Wadhwani (Expert)
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11 May 2009 A business owner claiming depreciation for his residential premises is disallowed.

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Shailaja.G.C

Shailaja.G.C (Querist)
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12 May 2009 Yes building has been shown as fixed asset( as residential property). But pls any more answers, as i hav got 2 contradictory views.
Hi Nitin,if we cannot claim depr., then wat for is the rate @ 5% is given for buildings on residential property.

ca hardik

ca hardik (Expert)
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12 May 2009 for the matter of the allowance/disallowance, if the company giving the perks of the residence facility to it's employee/directors, it will be allowed as a expenditure, otherwise that will be disallowed. and the rate is given for the purpose of the capital gain tax calculation at the time of sale, in that regards no question of the allowance/disallowance arises.

CA Nitin Wadhwani

CA Nitin Wadhwani (Expert)
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12 May 2009 That rate of 5% for residential premises is for a Entity which provides accomodation facility to its employees.

Shailaja.G.C

Shailaja.G.C (Querist)
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12 May 2009 Thanks for all

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