Upgradation of software expenses - Capital or revenue Exp.
This query is : Resolved
G.Kamatchi
(Querist)
04 July 2008
Upgradation of software expenses - whether it should be treated as Capital or revenue expenditure.
For instance whether expenses incurred in connection with upgradation from MS 2003 to MOS 2007 will be treated as capital or revenue.
For instance whether expenses incurred in connection with upgradation from MS 2003 to MOS 2007 will be treated as capital or revenue.
05 July 2008
Amount spent for acquiring of a new asset is treated as Capital Expenditure. Also, amount spent on imrovement of any asset is also treated as capital in nature. In the instance case the amount spent for upgradation is also an imrovement to the existing software which will definitely have certain extra features. As such, the amount spent for upgradation be treated as Capital Expenditure.
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