PLEASE LET ME KNOW ABOUT COMPUTER SOFTWERE FALL IN FIXED ASSETS IF YES WHAT WILL BE PERCENTAGE OF DEPRECIATION.
CA. Akhil Maangal (Head - Finance & Accouunts) 20 April 2013
Computer Software will be shown under the Head "Non Current Assets" >> "Intangible Assets" and Rate of Depreciiation would be 40% as per Compaanies Act, 1956.
Sanjeev Parasrampuria (B.Com CA Final CS Final) 20 April 2013
As per AS-26, Intangible Asset should be amortised in following manner:-
◘ Software - 3 to 5 Year
◘ Others - 10 Year
We can take more than 10 year if justified.
Intangible Asset will be shown under the head "Non Current Asset".
CA. Kuldeep Singhi (Entrepreneur) 20 April 2013
As per recent amendment in Income Tax Act , 1962 , We have to deduct TDS on purchase of Software u/s 194J as it is treated as payment for Royalty , So after amendment by Finance Act,2012 we can treat it as revenue expense rather than capitalising it & claiming depreciation.
Vishal P. Deshmukh (Officer Accounts & Finance) 20 April 2013
Software will be shown under the Head "Non Current Assets" with "Intangible Assets"
Puneet (Senior Executive -Finance & Accounts) 21 April 2013
BEFORE THE INTRODUCTION OF Finance Act,2012 computer software purchased (either as package software or customised ) was to be treated as asset and was liable to depriciation u/s 32 of income Tax Act,1961 @ 40%.
But after the date FA,2012 was made applicable ,now payment for purchase of computer software will be classiferd as revenue expenditure u/s37(1) and hence liable for Deduction of TDS (if applicable). This change has come due to change in defination of Royalty u/s 9 of Income tax act, where in some explanations were added.Hence, it is no more a capital asset.