Dear Team,
What is a treatment of expenses incurred by Private Limited Company on office rent, salary of staff, regular office expenses etc. after incorporation but before revenue generation under Income Tax.? Can the said expenses be treated as pre-operative and amortize over a period of time?
Please advise.
These are required to be debited to the P&L A/c as these are being incurred after formation of the co. However the co can c/f the business loss upto 8 A.Y.'s & it can claim the set-off against its business income in the future
IT IS NOT NECESSARY FOR A COMPANY TO START REVENUE GENERATION FROM FIRST DAY OF COMMENCING BUSINESS. SO WHATEVER EXPENSES RELATED TO BUSINESS OPERATIONS WILL BE DEBITED TO P&L ACCOUNT.
| Originally posted by : Giridhar S Karandikar | ||
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These are required to be debited to the P&L A/c as these are being incurred after formation of the co. However the co can c/f the business loss upto 8 A.Y.'s & it can claim the set-off against its business income in the future |
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Totally agree with Sir.
u can take these expenses as capital work in progress and show nil profit and loss account.
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