Accounting treatment on FBT on preoperative exp

Pre-operative Expnses is considered for FBT Calculation.

Whether pre-operative expenses falling within the categories specified in section 115WB(2) would be covered in the scope of fringe benefits?

16. Any expenditure incurred for the purposes referred to in clauses (A) to (P) of sub-section (2) of section 115WB is liable to FBT irrespective of whether such expenditure is incurred prior to commencement of the business or thereafter.

Thanks for your reply, but  I have already written in my question what you have replied. I want  to clarify accounting treatment of FBT on preoperative exp whether it would be capitalised or would be shown on the face of PL Account

dear friend....

you already aware that income tax is not an admissible expense  for calculation of taxable income u/s 40 a.U also a ware that  preoperative(preliminary) expenses are admissible as an expense over a period of 5 years u/s 35 D.If we include  FBT in preoperative expense , it should also be included for the purpose of deduction u/s 35 D which is a contravention of section40 a.

therefore it is advisable to showit below line.

Well my friend you will have to capitalise fbt as per AS 10...as it clearly says any expenses/taxes are required to be capitalized.

On the other hand,in income tax fbt wold not be shown in fixed asset schedule.There would be a difference in addition among companies act fixed asset schedule and income tax,the diiference would be of fbt.

For any further queries,feel free to ask.

Thanks & Regards,

Shobhit Singhee