AS 11 & AS 22

Dear all, my query is for Simultaneous application of AS11 & AS22.
As on 31.03.09 I capitalise exchange difference as per AS11.
Now I will just compare WDV and workout deffered TAX.
However, Capitalisation thru AS11 is only in accounts not in taxation. Hence its permanent difference.
From next year again I will compare the WDv and take deffered Tax, but ……
Now whats the problem???
in next year accounts WDV of exchange difference part is also included. 
How to remove that???
Since the term loan is not for one or two assets at the same time depreciation rate is also different for different assets.
How to remove that from WDV in next year???
Or anyone of u guide me for AS11 and AS22 Compliance, would be a great help for me….

Replies (2)
Originally posted by :Girish Jain
" Why is it that capitalisation under AS -11 is restricted to Accounts only. It is very much valid under Income tax act. Whatever is your timing difference is on the difference in depreciation as calculated on the capitalised amount as per books and as per income tax act.




Dear all, my query is for Simultaneous application of AS11 & AS22.


As on 31.03.09 I capitalise exchange difference as per AS11.


Now I will just compare WDV and workout deffered TAX.


However, Capitalisation thru AS11 is only in accounts not in taxation. Hence its permanent difference.


From next year again I will compare the WDv and take deffered Tax, but ……


Now whats the problem???


in next year accounts WDV of exchange difference part is also included. 


How to remove that???


Since the term loan is not for one or two assets at the same time depreciation rate is also different for different assets.


How to remove that from WDV in next year???


Or anyone of u guide me for AS11 and AS22 Compliance, would be a great help for me….


"

Dear Ameet, capitaisation under Incometax is Permitted only if such assets is Imported as Per sec. 43A. In my case asset is not imported but payment is made (Term loan) in USD.

Whats the term IMPORT Says under Income Tax Act?

 

 

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