Income tax/depreciation
This query is : Resolved
01 June 2012
is software is asset to the organization if yes what is depreciation rate for that please sir give me ans
02 June 2012
Software is required to be treated as an intangible asset under AS-26.
This should be amortised at the lower of the Schdule XIV rate or the useful life thereof.
In practice, a bought out application software (enterprise-specific for sales and debtors) is usually charged off as an expense whilst operating software (like Windows operating system) is capitalised in the books. Where significant cost is incurred on acquiring right to use it say on ERP packages, the initial cost is usually capitalised and for any subsequent upgrades or modification, there are mixed practices of capitalisation and charge-off as expense.
This should be amortised at the lower of the Schdule XIV rate or the useful life thereof.
In practice, a bought out application software (enterprise-specific for sales and debtors) is usually charged off as an expense whilst operating software (like Windows operating system) is capitalised in the books. Where significant cost is incurred on acquiring right to use it say on ERP packages, the initial cost is usually capitalised and for any subsequent upgrades or modification, there are mixed practices of capitalisation and charge-off as expense.
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
- About TDS & Income Tax
- Tax on Deemed Capital Gain
- Scrutiny and reopening of past returns
- Type of Capital Gain
- Booth for sales promotion
- Exiting partner in partnership firm in gst portal
- Regarding ITR filing with more value than showing in AIS/TIS
- F & O PROFIT REPORTING FOR AY 2026-27
- ITR-Capital Gain
- TDS _Long term Capital Gain ref.sec 214 Table 2
- Housing Society-ITR5
- TDS on Rent received on redevelopment of building
- Indian IT Portal issue in computing tax as per UK-India DTAA
- Capital Gains on sale of residential flat
- Upload Level ValidationITR3Category of Defect B/D
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Taxation in the hands of Landowner under JDA
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
