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Expenditure

Tax queries 304 views 3 replies

What is the meaning of expenditure as per the Income Tax Act? Does it include revnue and capital expenditure?

Replies (3)
Capital expenditures are for fixed assets, which are expected to be productive assets for a long period of time. Revenue expenditures are for costs that are related to specific revenue transactions or operating periods, such as the cost of goods sold or repairs and maintenance expense.



Revenue expenditure is debited to P&L in the form of direct and indirect expenses while only the depreciation on capital expenditure is debited to P&L.
There's no specific words about expenditure has been made yet but simply expenditure lies where any business profession spend some of amount to get its business entity run continuously that amount could consider as expenditure but it has many forms.

Income tax speaks about both expenditures generally capital expenditure is not allowed as deduction except in certain cases like family planning ,scientific research expenditure etc but revenue expendiure is generally allowed as  a dedction but in certain cases that too are not allowed like personal expenses etc  


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