depr

ya the company should charge depreciation on the flat at the rate of 5%.since the 4 condition for claiming depreciation is satified

1.flat is owed by the co.

2.it is used by the co. (even if it is passive use)

3.it should be used during the relevant py

4.Depreciation on tangible Asset

Regards

Renuka .kadge

Depreciation to be charged or not depends on the nature of asset. If this is purchased to be used for the business than depreciation will be charged. If there is no intention to be used for the business than no dep. is required to be charged than it will be shown as investment not as assets.

no

Your Q has two Possibilities :

1. If the asset is not used by the co. and not by anyone else even, than depr. is not to be charged at all.

2. If the asset is not used by the co. but by anyone else on the name of co., then depr. is definately to be charged.

So, here imp. point is that if flat is used than at whose name it is used and not at whose name it is owned.

It can also be a case of Lease agreement were the building is in the name of the company but it is used by the lessee.

The copmany is not using it. But the company can claim depreciation if it is an Operating Lease(AS 19)

yes the depreciation should be charged.

the reasons are given below.

1. the owner is the company

2 the company is in possession of the flat

3 and depreciation is charged as per wear & tear and efflux of time

4 so it does not matter that comapy is using it or not

5 depreciation is charged as per efflux of time

Yes as i earlier stated.. if the asset is used by anyone else, i.e on lease basis, then deprn is to b charged by co. only (as clarification given by priyadarshini).... othervise in finance lease, it shd b charged by user n not co.