35AD deduction

Tax queries 236 views 1 replies

Is the deduction for specified businesses (u/s 35AD) available to Individuals(not registered PVT LTD company)?

Note: Specified Businesses-Setting up of agricultural warehouse.

Replies (1)

Section 35AD Deduction Overview:

Section 35AD provides a 100% deduction of capital expenditure (other than land, goodwill, and financial assets) incurred for setting up and running certain specified businesses. One such specified business is the setting up of an agricultural warehouse.


Applicability to Individuals:

  • Yes, Individuals can claim deduction under Section 35AD, provided the business activity qualifies as a "specified business" under the section.

  • The section does not restrict the deduction only to companies or firms; it applies to all taxpayers carrying on the specified business.

  • The individual must be engaged in the specified business and incur capital expenditure on the same.


Important Notes:

  • The deduction is available only for capital expenditure incurred wholly and exclusively for the specified business.

  • Land, goodwill, and financial assets are excluded from this deduction.

  • If the individual opts for this deduction, depreciation on such assets cannot be claimed.


So, for your case of setting up an agricultural warehouse:

  • An individual can claim deduction under Section 35AD on capital expenditure incurred for the warehouse setup.

  • Ensure the expenditure qualifies and documentation is maintained.


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