RTO & Insurance charges for New Car is to be capatilised or we can debit to P&L. For this any AS is available. Pl inform the same.
Menu
RTO & INSURANCE CHARGES
Replies (8)
Hi Deepak
Both the charges to be routed through P/L a/c and these charges don't give any benefit of enduring nature as per AS 10 "Accounting for Fixed assets"
Sir,
RTO is one time tax and we can utilise it for next 15 years. cant we transfer RTO in capital assets?
Oh... RTO can be capitalised. sorry but didnt know of its nature.
boss it is simple
expenses having long term benefits are capitalised and those which are recurring or whoose utility is less than or equal to an year shall be routed to profit and loss account.
Hi dude,
I think, RTO tax should be capitalized & Insurance Charges should be charged to P&L A/c. (subject to - Car is used for a business purpose.)
All kind of expenditures incurred in bringing the asset to put into use should be capitalised. In your case, Road Tax and Insurance charges incurred before the car put into use and the insurance charges also ( first time insurance)should be capitalised. Refer AS-10, "Accounting for Fixed Assets".
Yes first insurance premium and RTO tax should be capitalized
Why should first Premium to be capitalised? A little clarification on this will be quite helpful.
Recent Topics :
- LTCG: Home Loan Principal Repayment?
- Ims action relationship query
- GIFT REGARDING
- TDS on salary to non resident managing director
- Ewaybill and Transport documents (Lorry receipt)
- LTCG on sale of Builder Buyer Agreement
- Rule 13(2)(h) and valuation of CCDs
- Leave encashment, New labour code, Management cadr
- GST clarification needed:
- TDS processed with short deduction default
Related Topics :
CAclubindia
