Setting up and commencement of business

Posted on 08-05-2016        By ADMIN

Setting up and commencement of business Setting up of business is different from commencement of business. A business is set up as soon as it is ready to commence production or any other activity of business is started and its not necessary that the actual production should have so commenced. In case of newly set up business or profession, PY commences on date of its setting up. Expenditure incurred after setting up of business but before its commencement is deductible. Case law : Tuticorin alkali chemicals & fertilizers ltd. V.CIT Measures of tax planning a) After planning its installation programme, a company should see that its business is set up at the earliest. The commencement of the business may be postponed till a later date. The decisions in this regard must be taken after keeping into consideration the general tax aspects of the company viz. tax holidays and deductions, c/f of losses and unabsorbed depreciation etc.; b) The expenditure incurred prior to setting up may be eligible for deduction under section 35D as preliminary expenses. The assessee company should see to it that such ............ CS Executive Tax Mcq Notes CS Professional Advanced Tax law Notes

Comment :