Income tax/depreciation
This query is : Resolved
vamshi krishna
(Querist)
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
- 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
