A company sells a used car in Jan 2020 after claiming depreciation u/s 32 of Income Tax Act 1961. They have to pay GST on surplus over WDV realized by such sale. In IT records, depreciation has been claimed upto 31/03/2019. Should they calculate proportionate depreciation upto 31/12/2019 for arriving at surplus ??
There is no provision under Income Tax Act for proportionate claim of depreciation upto date of sale. Please clarify.
Company Can Claim Full Depreciation at 50% for Used Car Sold in 2020 Under Section 32 of Income Tax Act A company sold a used car in January 2020 after claiming depreciation under Section 32 of the Income Tax Act, 1961. They inquired whether they should calculate proportionate depreciation up to December 31, 2019, to determine the surplus for GST purposes, as depreciation was claimed up to March 31, 2019. The response clarified that the Income Tax Act allows a six-month period for claiming depreciation, and since this period has passed, they may apply the full rate of depreciation at fifty percent. (AI Summary)
Goods and Services Tax - GST
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