Wednesday, August 31, 2016

Rent,Repairs,Insurance etc.

The following expenses are allowed as deduction from income of Business or Profession:-
+ Amount spent on repairs to the premises.
+ Amount paid for land revenue, local rates and municipal taxes subject to Sec 43B.
+ Insurance Premium paid for covering risk of damage of premises.
+ Rent paid for the premises.
+ Amount spend on repairs by tenant is allowable as deduction to the tenant.

Notes:- If any amount is incurred as capital expenditure, then it is not allowed as deduction. But depreciation can be claimed on such amount.
If capital expenditure is incurred by tenant, then depreciation is allowed to tenant only.
If expenditure incurred or asset used partly for business and partly for other purpose, the only proportionate amount is allowed as deduction. [ Sec 38 ]

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