Depreciation
This query is : Resolved
14 June 2010
X is a partner in a firm XY & Co, firm owns a car which is partly used by x for his personal use & partly for business purposes. Using assumption it is assumed that 80% is used for business purposes % remaining for personel use.Firm will claim dep.@15%, but will be deductible as per rules only 80% of total dep.Now how will partner treat this in his individual case.Comment?
(Explain is this a perquisite in his hands (X) & taxable @ 1200 per month or 1600 per month depending upon the cubic capacity of engine,or not)
(Explain is this a perquisite in his hands (X) & taxable @ 1200 per month or 1600 per month depending upon the cubic capacity of engine,or not)
15 June 2010
Since the car is owned by the firm and is only eligible to claim depreciation. Since 20% of the car expenses pertain to the personal use of the Partner, the depreciation, car maintenance expenses, car insurance will be disallowed to the extent of 20% in the firm's assessment. The taxability of perquisite in the hands of the partner does not arise since he is not employee and no amount is taxable under the head salary in the hands of the Partner.
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