Tax allowable depreciation and sale proceeds

Hi

When an asset is bought and depreciated accordingly for 3 years and sold without depreciation for the held for sale period, i.e., the third years carrying amount minus sale proceeds (we have a balance). According to indian tax provisions, is it called balancing allowance where it is also considered for claiming tax

(Year 1 TAD+ Year 2 TAD+ Year 2 carrying amount (opening balance of Year 3) - sale proceeds gives Balancing allowance) x corporate tax rate? 

Note: asset classified as Held for sale for 12 months) 

Txs

Replies (6)
Quick Summary
This discussion explores how to treat the difference between an asset's carrying amount and its sale proceeds after depreciation, specifically under Indian tax law. The user is inquiring if this difference constitutes a 'balancing allowance' and how it's calculated for tax relief, considering the asset was held for sale for an extended period. The conversation touches upon the timing of the sale within the financial year and seeks specific section references for clarification.

Was it sold before the conclusion of the financial year?
Pls cite section reference fir balancing allowance.
Mr Mukherjee..I would be helpful if you just stay put..it's ok if you don't help. but please don't mislead people by posting half baked answers

Consider it like this for knowledge purpose. It was held for sale from start till end of FY for eleven months and twenty days. So NBV of 2nd year and opening balance of 3rd year is per say thousand rupees and disposed for 500 and the balance is thousand minus 500. So im guessing that tax relief is year 1 tad + year 2 tad + 500 * corporate tax rate.  Correct @ Mr Ashwin Kumar

These are not half baked answers . There is no term called half baked answers.

Why can't everyone help me with answers instead of arguing with each other so that I'll be a pioneer tax planner. If I know that I'm one the biggest CA in India. Look at my capabilities of interpreting Indas, IFRS and AS. Who else is bigger than me apart from crooked le turers who never answered me. I don't actually need anyone if you don't answer my questions 

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
05 October 2026
Senior Accountant

Vision IT Peripherals Pvt Ltd

Mumbai

B.Com

View Details
Company
08 October 2026
SALES TELECALLER

HIRE NOVA

Lucknow

Graduate (Any)

View Details
Company
30 September 2026
Senior Accountant

Codeboard Technology

Chennai

B.Com

View Details
Company
16 September 2026
Internal Audit - Team Lead

Consulting & Beyond

Chennai

CA

View Details
Company
ARTICLESHIP 21 September 2026
CA Article Assistant

KK & Company Chartered Accountant

Pune

CA Inter

View Details
Company
ARTICLESHIP 16 September 2026
Article Assistant

MANUJ SHARMA AND COMPANY

Noida

CA Inter

View Details
Company
Featured 21 September 2026
Consultant - Reporting

Finrep Advisors LLP

Mumbai

CA

View Details
Company
ARTICLESHIP 07 October 2026
Article Trainee/ CMA Trainee

RMA And Associates LLP

New Delhi

CA Inter

View Details