INCOME TAX

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This discussion clarifies whether depreciation can be claimed on commercial property when interest on a loan for that property is already being claimed as an expense. The consensus is that depreciation is indeed allowable on the building itself, provided it's used for business purposes. However, it's important to note that land does not depreciate, so any costs directly related to the land cannot be included in the depreciation claim for the building.

sandeep shah

sandeep shah (Querist)

25 February 2020 interest on loan paid against commercial property is claimed as expense. whether depreciation on such commercial property is allowed or not

Eswar Reddy S

Eswar Reddy S (Expert)

25 February 2020 If it is used for business purposes then you can claim the depreciation

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

25 May 2020 Yes depreciation can be claimed on such property.

The expression ‘building’ does not include land because the land does not depreciate. Any expenditure incurred by an assessee, directly referable to the land and not referable to the building, as distinct from the land, cannot constitute a part of the cost of construction of the building for the purpose of allowance of depreciation.

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