Method of depriciation
This query is : Resolved
21 January 2014
hello sir...
my client is a private limited company and while checking the audited balance sheet it was found in notes to accounts , method of deprecation followed was WDV as per IT Act, i.e. 30% on motor vehicle (for hiring) but as per companies act rate (WDV) 40% on motor vehicle (for hiring). please suggest what to do as we can not charge deprecation lower then as mentioned in companies act.
PLZ Reply...
my client is a private limited company and while checking the audited balance sheet it was found in notes to accounts , method of deprecation followed was WDV as per IT Act, i.e. 30% on motor vehicle (for hiring) but as per companies act rate (WDV) 40% on motor vehicle (for hiring). please suggest what to do as we can not charge deprecation lower then as mentioned in companies act.
PLZ Reply...
Guest
Guest
(Expert)
21 January 2014
Show as per companies act 40% but while filing the Income Tax Return add back that depreciation amount and less the amount as per income tax act.
21 January 2014
as per companies act on slm method it was 16.21% and 40% (WDV) . but compnay book dep in books as per it act i.e. 30%
whether it was correct ??
whether it was correct ??
Guest
Guest
(Expert)
21 January 2014
No it is incorrect. It is the minimum rates given as per the companies act. Company should charged 40% depreciation as per the companies act 1956.
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