SUMIT (A.M.) (53 Points)
24 June 2011Can we directly charged the fixed assets (valued less then 5000) to P & L, without routing them from Fixed Assets Register. If yes then what is the way for this (are we need to report this change in our notes of accounts). What is method suggested by our accounting standard. Kindly provide AS reference if possible. If we do this, is there any violation as per income tax act ?
Many Thanx in advance
sivaram
(Asst Mgr-Taxation)
(6918 Points)
Replied 24 June 2011
AS-10 doesnt speak about this actually it is stated only in Schedule VI of companies Act.Since Act Prescribes the same definitely it is not voilation of Income tax Law
Divya K S
(CA)
(289 Points)
Replied 24 June 2011
Fixed Assests costing less than Rs. 5000 can be directly charged to P & L a/c as per Schedule XIV of Companies Act. Further, Depreciation need to be recalculated as per Income Tax Act, since the fixed asset is in capital nature & is not an admissable expense. For Income Tax purpose, depreciation will be charged on such fixed asset.
C.A Karne Wale Ki Love Story: Me 3 Sal Ka Tha Wo Peda Hui Me Ne Skol Admsn Lia Vo 2 Sal Ki Thi Me Primary Me Tha Vo Prp Me Thi Me Mdl Me Tha Wo Primary Me Thi Main Matric Me Tha Wo Mdl Me Thi Mai F.A Me Tha Wo Matric Me Thi Main C.A Me Tha Wo FA Me Thi Mai C.A Me Tha Wo BA Me Thi Mai C.A Me Tha Wo MA Me Thi.. Mai C.A Me Tha Wo M.Phil Me Thi Me C.A Me Tha Vo Ph.D Me Thi Me C.A Me Tha Vo Doctor Bn Gai Kal Uski Shadi Hy Aur Mera C.A Ka Paper Hy... Share
Aparna Raja K.C
(Student)
(520 Points)
Replied 24 June 2011
Agree with Divya :)
and from where does this love story come in between fixed asset and its transfer ?
Subhasish Mazumder
(Manager Accounts)
(34 Points)
Replied 27 June 2011
| Originally posted by : Robin | ||
 |
C.A Karne Wale Ki Love Story: Me 3 Sal Ka Tha Wo Peda Hui Me Ne Skol Admsn Lia Vo 2 Sal Ki Thi Me Primary Me Tha Vo Prp Me Thi Me Mdl Me Tha Wo Primary Me Thi Main Matric Me Tha Wo Mdl Me Thi Mai F.A Me Tha Wo Matric Me Thi Main C.A Me Tha Wo FA Me Thi Mai C.A Me Tha Wo BA Me Thi Mai C.A Me Tha Wo MA Me Thi.. Mai C.A Me Tha Wo M.Phil Me Thi Me C.A Me Tha Vo Ph.D Me Thi Me C.A Me Tha Vo Doctor Bn Gai Kal Uski Shadi Hy Aur Mera C.A Ka Paper Hy... Share |
 |
SO DON'T LOOSE YOUR TEPARAMENT YOU WILL BE DEFINITELY A WINNER LIKE ME. THANKS
Priyanka Bhatnagar
(Accounts & Finance)
(44 Points)
Replied 29 June 2011
Agreed with Divya, but it is a good practise to disclose assets less then Rs. 5000 in the FA schedule, with descripttion n shown at a nil value. it is also useful for Audit purposes
CMA Shanmukha
(Asst Manager)
(21 Points)
Replied 07 September 2012
Mr Robin,
That means u r not concentrated on your studies
T S D
( )
(236 Points)
Replied 10 September 2012
Schedule XIV to the Companies' Act,1956 (the Act) requires that asset costing Rs.5000/- or less shall be depreciated in full (i.e 100%). WDV of Re.1/- may be retained on those assets. The basic idea behind retaining Re.1/- is the identification of asset. It is nowhere mentioned in the Act that those items can be charged directly to P & L. Kindly notice the word "ASSET Costing....." in the Act.
I may stand corrected if I was wrong.
CA KUSHAL BAJAJ
(PARTNER)
(22 Points)
Replied 02 August 2013
agree with divya
In books of accounts you show it as a expenses, just while filling incometax return you add back that expenses from net profit and deduct depreciation from net profit.
CAclubindia
