Depreciation on Hoardings

Please Help,

                        One of my client had purchased Hoarding ( Advertising Board standing on iron Rods )  worth Rs 5 lacs but we aren't able to trace the Depreciation rate Both as Per Sec 32 of Income tax Act and As per Sch 14 of Companies Act.

Thanking you in Advance

Replies (3)

income tax - 15%

co act  - 13.91%

as per my knowledge these hoardings should not be capitalised, although it is in the nature of capex. These expenditures are incurred for advertising purpose hence shuld be charged to p&l a/c as advertisement and publicity. However, if these hoardings are in the nature of neon signs these should be capitalised. The applicable rate is 15% (treated as plant& machinery.)

 

The above views are from income tax point of view..............

pls correct me if i m wrong somewhere.

Thanks.

Thanks a lot sharad and Trapti,. i haven't Capitalised the Expense but had prepaid it period wise for 2 years.

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