problem regarding depreciation. please help

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  1. Buntybabu

    Buntybabu New Member

    Assessee - Individual
    PY - 2014-15, AY - 2015-16
    relevant data :-
    asset - Furniture
    rate of Depreciation - 10%
    cost of acquisition - 300000
    opening WDV of the block - 700000 (3 furnitures)
    during 14-15, 2 old furnitures sold for 900000
    on the closing date, the new furniture & one old furniture exists in the block

    Q 1
    - A furniture was acquired during 14-15 & put to use during 14-15
    case a) out of which 200 days for business, & 50 days for private use in home.
    case b) out of which 100 days was for business & 200 days for home use.

    Q 2 - the furniture was acquired during 14-15, but in 2014-15, it was put entirely to home use. In 15-16, it was used
    case a) 100 days for business & 200 days for home
    case b) 200 days for business & 100 days for home

    Please say what will be the amount of depreciation allowable for Income Tax purpose for 2014-15 & 2015-16, & how to calculate it in the above mentioned cases.



    One particular asset used for more than 1 business
    Assessee (Individual) has two businesses carried on in two different shops, for each of which separate set of books of accounts are maintained

    Q
    - Furniture costing 300000 (depre rate 10%), acquired during 14-15 & put to use during 14-15 itself in the following manner :-

    case a) In Business 1 - 70 days & In Business 2 - 80 days
    case b) In Business 1 - 90 days & In Business 2 - 100 days
    case c) In Business 1 - 182 days & In Business 2 - 183 days
    case d) In 2014-15, the asset was used entirely for private purpose, in 2015-16, it was used 70 days for Business 1 & 30 days for Business 2
    Please say what will be the amount of depreciation allowable for Business 1 and Business 2, for 2014-15 & 2015-16, & how to calculate in the above mentioned cases.

    Thanks in advance. Please Help.
     
  2. sai tejesh(ca.final)

    sai tejesh(ca.final) Active Member

    Before answering to your question i would like to explain you two points...
    A) Asset acquired during the year and put to use for the purpose of bus.(or)prof during the year.
    a)De[email protected]%..if put to use for the purpose of bus.(or)prof.is>180 days.
    b)De[email protected]%..if put to use for the purpose of bus.(or)prof.is<180 days.(thats all,just calculate dep.amt. based on the period of use of asset for the purpose of bus.(or)prof for first year.).
    B)For second and subsequent years calculate dep amount in proportion to no of days,the asset used for the purpose of bus.(or)prof.

    solution:
    Q.1)
    CASE A-100000*15%=15000(PUT TO USE >180 DAYS).

    CASE B-100000*7.5%=7500(PUT TO USE <180 DAYS).

    Q.2)
    CASE A-100000*15%*=15000=15000-15000*200/365=6780/-(F.Y15-16).
    CASE B-100000*15%=15000=15000-15000*100/365=10890/-(F.Y15-16).

    NOTE:
    In the above cases if you don't use the asset for the purpose of home use (even for a single day) you can claim full value of depreciation i.e15000/-.

    That means for second and subsequent years,even if you don't use the asset for the purpose of business..but you have an intention to use it for the purpose of business(without using it for home use) you can claim full value of depreciation.
     
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