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Q. > Please Help: Revenue exp. Or capital exp.
Mr X is a practing CA and purchase a software of TALLY on 30/6/2011 and install the software in his computer. He starts using the software from 1st April 2012. Discuss the depreciation allowed to Mr. X in view of PGBP...
answered Jul 12, 2011 by PRIYANKA , GREATER NOIDA
Yes , this would be treated as revenue expenditure and taken to p&l A/c, point of deprectiation does not arise.
answered Jul 12, 2011 by CA. Sachin Data , Alwar
It is non- capital expenditure hence no depeciation allowed.
answered Jul 12, 2011 by CA. Sachin Data , Alwar
Software is a tangible asset having a limited life as it gets obsolete due to technical changes. Hence, it is a item of revenue expenditure.
answered Jul 14, 2011 by CA VIKAS JAIN , DELHI
this should be charged against revenue and not be capitalised. further more the expense to be capitalised, the monetory limit of expenditur should be considered. for example instead of tally suppose the case will be installing a SAP then that expenditure certainly be capitalised.
answered Jul 15, 2011 by CA Richa Gupta , Faridabad
This expense is inccured for his operations that y this vl b charged as revenue exp. no dep will be calculated on that amt.
answered May 30, 2013 by Vikash Kumar Jha , Cuttack
You have not explain monetary value and duration rlated to software. Because it will be important aspect to judge wether it will be capitalise or not. Without specific information you can take it as a revenu expenditure.
Experts Panelist
Comments
Saurabh Mittal
11-Jul-2011 , 05:11:26 pmas per recent case of supreme court software purchase treated as revenue expenditure not a capital expenditure so not possible for claiming depreciation on tally software.
Saurabh Mittal
11-Jul-2011 , 05:11:26 pmas per recent case of supreme court software purchase treated as revenue expenditure not a capital expenditure so not possible for claiming depreciation on tally software.
PRIYANKA
12-Jul-2011 , 05:22:09 pmYes , this would be treated as revenue expenditure and taken to p&l A/c, point of deprectiation does not arise.
CA. Sachin Data
12-Jul-2011 , 05:45:19 pmSoftware is a tangible asset having a limited life as it gets obsolete due to technical changes. Hence, it is a item of revenue expenditure.