PGBP - PART-1

Charging section [sec 28] Rent, Rates, Repairs & Insurance for Building used in B&P [sec.30] calculation of WDV of block & depreciation Capital gain / loss depreciable asset
Following Income are Taxable under this head :- Rent Rates Repairs Insurance Opening wdv of block as on 1st day of py xx If WDV of block for depreciation is
1. Profit or gain of any Business or Profession carried by Assessee ↓ ↓ (+) actual cost of asset purchase during py negative
during py. Allowed Allowed Revenue Capital Allowed Put to use for 180 days or more
2.Assisatance Grant or Subsidy received from Central / State Put to use for less than 180 days ✓Short term capital gain
government relating to B&P. Allowed Not Allowed [Added to cost of building] Purchase but not put to use during py xx ✓No depreciation
3.Export Incentive - Cash Assistance. (-) Amount receive on asset sale/destroy/
- Duty Drawback. Repair, and Insurance plant & machinery , furniture [sec.31] demolish/degraded during py xx If WDV of block for depreciation Is
- Import Entitlements. WDV of block for depreciation xx negative:-
4.value of any gift , benefit or Perquisite arising from B&P. Rent Rates Repairs Insurance (-) Depreciation xx
5.Amount receive for - Not carring out any activity relating to B&P. ↓ ↓ Closing WDV as on last day of py xx
✓Short term capital gain
- Not sharing Intangible Asset. Allowed Allowed Revenue Capital Allowed
Depreciation on WDV of block ✓No depreciation
6.Amount receive under keyman insurance policy.
7.FMV of stock on Conversion in to capital Asset Allowed Not Allowed [Added to cost of P&M]
8.Intrest, salary, Bounas,Commission or any Remuneration received On cost of
On cost of asset if all asset of block is sold If
by partner From Firm /LLP[upto deduction allow to Firm/LLP] . Asset purchase
put to use for less Balance WDV WDV of block for depreciation
but not put to
Deprecation as per income tax act [sec.32] than 180 days Is positive :-
use during py
Speculative Business ✓Short term capital loss
. Part of Business Consist of Purchase/Sale of Share and
1.Condition to claim depreciation Half rates ✓No depreciation
. Asset must be used in B&P [Active and passive ] Depreciation
commodities other than by actual Delvery.
And Half restriction Full rate
.Proft/Loss of Speculative business to be calculated separately. No depreciation
.Assesses must be owner of such asset [wholly and partly] applies only when Depreciation
.Following are not speculative transaction Note Purchase & put to Additional Depreciation
Hedging Contract Depreciation allow only when asset is put is put to use use year same
However is case of - stand by equipment
Forward Contract
-Fire extinguisher Depreciation allow even if
Trading in Derivatives/Commodity Derivatives Assesse engaged is business of manufacturing / production of any article [factory/industries]
-machinery spares
Or generation /transformation distribution of power :-
They are kept ready for use
Income of PGBP computed as per sec. 30 to 43D [sec. 29] Deprecation allow to beneficial owner Purchase new plant & machinery during PY
In case of lease asset , lessor is entitled for Deprecation Additional Depreciation - [ 20% of actual cost if put to use up to 3rd oct [Allow as deduction]
Calculation of PGBP Income :- No Deprecation on land and goodwill
Profit/Loss as per P&L A/c xx -10% of actual cost if put to use after 3rd oct
It is mandatory to claim Deprecation 10 % of actual cost if put to use after 3rd oct ] [balance to next year]
Add:
Depreciation debited to P&L xx
2.Depreciable assets :- Note:-
Expenses debited to P&L A/c
✓ Business of printing & publishing also eligible.
but not allowed as deduction under this head [Disallow] xx
Tangible Intangible ✓No Additional deprecation is following P&M.
Income not credited to P&L A/c but
Building furniture P&M knowhow,patent,copyright,trademark ✓Second hand plant & machinery
taxable under this head xx
Class 1 Class 2 Class 3 licenses,Franchies or other any other ✓Plant & machinery installed in office premises or residential Accommodation
-----
Business or commercial right of ✓office appliances /equipments
xx
similar nature[expect goodwill] ✓Ships,aircraft,road transportation vehicle [truck use factory eligible ]
Less:
Class 4 ✓Any P&M on which 100% depreciation is allowed under other section
Depreciation as per Income tax Act xx
Expenses not debited to P&L A/c but
3. Depreciation Rates
allow as deduction under this head xx
Income credited to P&L A/c but not Building Furniture Intangible assets
taxable under this head xx Block 1 - Residential Building - 5% Block 1 Block 1 - All Intangible assets -25%
[eg, CG ,OS,Agriculture income etc] Block 2 - Residential Building - 10% All Furniture - 10%
------- Block 3 - Residential Building - 40%
Income B&P xx
Plant & Machinery Note : if car purchase & put 4. Block of Asset
Block 1 - Aeroplanes pollution control equipment , medical equipment, windmills , energy between23-08-19 to 31- 03-20 • same class of asset AND same rate of depreciation
Saving devices , book and annual publication computer software accessories - 40% • depreciation shall be allowed on WDY of block of asset
Block 2 - ships - 20% Hire [taxis and buses] - 45% prescribed percentage
Block 3 - motor car [taxis buses ] used in business running on hire - 30% 5. calculation of WDV of block & depreciation
Block 4 - other motor car , oil wells, office equipment, appliances,pabex &mobile, other plant & machinery -15% Other motor car - 30%