Capitalisation of software


subramanyanadig (Accounts officer)     24 August 2019

subramanyanadig
Accounts officer 
 33 points

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A firm has paid Rs.40 lakh as advance for purchase of software out of 60 lakhs, and supplier provided invoice for 40 lakhs, but software is not put to use. my question is
can we treat Rs.40 lakhs as asset as supplier provided the invoice and claim depreciation.
can we deduct TDS on 40 lakhs.

Thanks in advance

avater

sanket bohra   24 August 2019

sanket bohra

 4 points

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TDS are not applicable on software purchase and also can't claim depreciation

avater

sabyasachi mukherjee   16 September 2019

sabyasachi mukherjee

 40 likes  1228 points

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No tds to be deducted.
Treat as Fixed Asset as per norms laid down in schedule 3 of companies act 2013.
Disclosure requirement.
Main Head- Non Current Assets
SubHead- Tangible Fixed Asset.
provide depreciation - as per norms laid down
Schedule 2.


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