Depreciation of Building
This query is : Resolved
23 July 2024
Greetings,
I would like to inform that as per company act depreciation on factory building useful life is 30 Years. Company has freedom to reduce the time if 2/3 shift working at factory premises. Company has been charging depreciation as per useful life of assets 30 Years since last 12 years. Where building construction on plot on lease. Lease from group of company. Lease period is 10 years.
Now New internal auditor pointed out that lease is 10 years then useful life of building should be 10 years not 30 years which is charged depreciation since last 12 years. Our statutory audit is big-4 .
My Query is can I change % depreciation rate and reduce useful life of assets from 30 years to next 10 years.
I have raised a query only in point of view of Company Act and Not income Tax act point of view.
Can you help me?
Regards,
Choudhari
I would like to inform that as per company act depreciation on factory building useful life is 30 Years. Company has freedom to reduce the time if 2/3 shift working at factory premises. Company has been charging depreciation as per useful life of assets 30 Years since last 12 years. Where building construction on plot on lease. Lease from group of company. Lease period is 10 years.
Now New internal auditor pointed out that lease is 10 years then useful life of building should be 10 years not 30 years which is charged depreciation since last 12 years. Our statutory audit is big-4 .
My Query is can I change % depreciation rate and reduce useful life of assets from 30 years to next 10 years.
I have raised a query only in point of view of Company Act and Not income Tax act point of view.
Can you help me?
Regards,
Choudhari
CA R SEETHARAMAN
(Expert)
24 July 2024
You can extend the lease.
If lease not extended you can sell the building as life of the building will be 30 years.
If lease not extended you can sell the building as life of the building will be 30 years.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Accounting treatment of AMC alongwith the purchase of Laptop
- Condonation Request sec 119(2) b -Enhancement Limit of Leave Exemption prior to AY 2023
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Issuing of delivery challan by seller of goods
- Not ordinarily resident having partnership income in India and salary in USA is any form to filed be
- Nursery business
- WRONG GSTR7 ENTRIES ACCEPTED ERRONEOUSLY
- Tax on Amount transferred in HUF Account
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
