Depriciation on hire purchase of asset

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Querist : Anonymous

Querist : Anonymous (Querist)

27 February 2013 Hi everyone actually my uncle have an wrriten agreement with a company where he is driving the car. and according to contract car is purchased by the company on hire purchase basis and the same amount of EMI is deducted from my uncle salary with promised that after 3 years the ownership of car is transferred to my uncle. so my question is whether i can claim the depriciation on this car or not..?? and can we treat the emi amount as expenses or not..?? and answer with suitable example..

@VaibhavJ

@VaibhavJ (Expert)

27 February 2013 Hi,

Since car is purchased by company & it seems it is also registered in the name of co. hence no depreciation can be claimed.

If it is salary income then no expenses can be claimed against deduction from salary.

Thanks!!

Querist : Anonymous

Querist : Anonymous (Querist)

27 February 2013 Company is deducting TDS on amount paid u/s 194C.. and it is a contract for running the car of company where company give fuel and maintenance charges of car to my uncle and deducte the TDS @ 1% on amount paid.. and Deduct the EMI also for Car.. so can we claim depriciation and EMI as expenses..?? and according to this contract the ownership of car/ RC of car will be transfered after 3 years when all the EMI will be paid by my uncle..??

@VaibhavJ

@VaibhavJ (Expert)

27 February 2013 Hey

No depreciation can be claimed & however payment of EMI can be shown as business expenses.

Thanks!!

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