CLU CHARGES WHETHER REVENUE OR CAPITAL EXPENDITURE

[satbir singhwahi]

Sir

CLU charges paid by Company, of the land owned by Director. On that land Workshop constructed by Company and used for business purposes.Whether these CLU charges paid are Revenue or need to be Capitalised in building account.

PLs Guide.

AI Summary

Determining if Change of Land Use charges should be revenue expenses or capitalized in building accounts for business land. A company paid Change of Land Use (CLU) charges for land owned by a director, where a workshop was constructed for business purposes. The query seeks to determine whether these CLU charges should be considered a revenue expense or capitalized in the building account. One respondent requested clarification on the term CLU, and it was explained as a fee paid to the state government for converting land use from agricultural to industrial.