WHETHER LIFETIME ROAD TAX PAID FOR A VEHICLE IS A CAPITAL EXPENDITURE OR REVENUE EXPENDITURE?
Treatment of lifetime road tax (capital or revenue)
(Guest)
4 Replies
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 13 June 2011
it should be treated as capital expenditure
Rajnikant Vadigoppula
(CA, CS And CMA Final)
(919 Points)
Replied 13 June 2011
yes it should be treated as capital expenditure and added to cost of acquisition
U S Sharma
(glidor@gmail.com)
(21063 Points)
Replied 13 June 2011
There is limitation of such expenditure, viz for two wheelers, its 15 yrs, for 4 wheelers its 5 years, and its added to cost of vehicle at the time of purchase of vehicle, any amount paid at the time of purchase of vehicle is capitalized automatically
there is nothing like lifetime, at the end of tennure of 5/15 yrs such regustration is renewed, and such expenses should be treated as revenue expenditure, as its not transferable and no resale value in absence of vehicle.
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