Depreciation in Trust Assets

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Shailendra Jaiswal, (Querist)
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12 November 2022 Hi,
I join as Accountant in a School of a Trust , Trust having multipole project, Commercial and Charitable

I see that school not taking depreciation in a account

please guide me on trust assets which he purchased for depreciation and some more special concern about this

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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12 November 2022 In case of charitable and educational trust entire purchase of assets were treated as application of funds.
Hence no depreciation charged in the accounts.

Shailendra Jaiswal,

Shailendra Jaiswal, (Querist)
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12 November 2022 what is application of funds
and what will be the treatment of purchase of assets in trust a/c

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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12 November 2022 Entire purchase of fixed assets is allowed as deduction from the income and donations of the trust as application of funds.
85% of the donations and income received is applied for charitable activities and purchase of assets for charitable activities then no income tax applicable on the trust.

Shailendra Jaiswal,

Shailendra Jaiswal, (Querist)
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15 November 2022 i'm basically handling only school project of the trust, school is financially independent from trust , its have its own income and exp. so please suggest me accordingly

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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15 November 2022 School will be part of charitable activities of the trust.

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