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Section 35 (2ab) - r&d expenses

Tax queries 421 views 1 replies

Dear Sir/Ma'am,

 

I have a query w.r.t. deduction allowed u/s 35 (2AB). It says that 200% is allowed, but my query is, does that mean 200% below the PBT or 100% below PBT.

 

My understanding is that all expenses are deducted before PBT and after PBT 200% of R&D expenses will be allowed. but the 2nd interpretation can be 100% (actual expense before PBT) and 100% after PBT, i.e., total 200%.

 

Please give clarification.

 

thank you.

 

Vijay.

Replies (1)

200% of the expenditure is allowed, that means If u had incurred 10 lacs expenditure and debited the same in P&L then deduct 10 lacs more (200%) while computing the Income under the head PGBP.

Its Normal computaion except that u have to reduce 2x expenditure.


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