Presentation On Sec.32AC PDF
Presentation On Sec.32AC PDF
Presentation On Sec.32AC PDF
In order to encourage substantial Investment in Plant & Machinery, It is proposed in Budget 2013-14 to insert a new section 32AC in the Income Tax Act. As per this section 15% of the amount invested in new Plant & Machinery will be allowed as deduction while computing taxable Income of the Assessee. This deduction will be in addition to Depreciation Allowance available in respect of new Plant & Machinery.
Contents
Applicability Conditions Consequences of Transfer with in 5 Years Challenges & Way Forward Approach
Applicability
Conditions
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Challenges.
Aggregating investments of Rs.100 Crs during Medium sized corporate can also aggregate their FY 14, FY 15 is a key challenge for a medium size investments at least over two years of periods to corporates. While this allowance is granted for claim this benefit. all the corporates, only the large corporates are likely to benefit from this incentive.
Installation of an asset is an important Robust planning for the timely acquisition and condition for availing this Investment Allowance. installation should be in place to avail this Investment Allowance. Installation of P&M amounting worth exceeding Rs.100Crs typically takes longer time for final installation. Two year timeframe may be inadequate to achieve this.
Sale of P&M within 5 years from the date of installation will require the assessee to surrender the tax benefit availed on the investment allowance.
As these P&M will not form regular block of assets from investment allowance point of view, one needs to keep detailed documentation for these assets to give correct treatment at the time of acquisition, installation and sale thereof.
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Thank You!
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