When an asset is transferred by way of gift, through a will, or by inheritance, the provisions for computing capital gains follow a “carry-forward” principle. This means: Cost of Acquisition:The cost that was originally incurred by the previous owner is carried forward. In other words, you will useRead more
When an asset is transferred by way of gift, through a will, or by inheritance, the provisions for computing capital gains follow a “carry-forward” principle. This means:
Cost of Acquisition: The cost that was originally incurred by the previous owner is carried forward. In other words, you will use the original purchase cost (plus any improvement costs, if applicable) paid by the previous owner rather than a market value or zero-cost.
Holding Period: The holding period of the asset is also inherited from the previous owner. This is important because if the asset had already been held for a long period (thus qualifying as a long-term asset), it will continue to be treated as such in your hands. This can have a significant impact on the applicable tax rate and the availability of indexation benefits.
Tax Implication: When you eventually sell the asset, the capital gain is computed by subtracting the inherited cost (adjusted for inflation, if applicable) from the sale proceeds. Even though you did not pay anything for the asset at the time of receiving it, the earlier cost and holding period remain in effect for tax purposes.
This approach ensures that the tax benefits achieved by holding an asset over the long term (such as lower long-term capital gains tax rates) are not lost when the asset is transferred by gift or inheritance.
Since you held the house for 5 years, it qualifies as a long-term capital asset. This means any profit (capital gain) from the sale will be taxed as long-term capital gains. Under the current provisions effective from Budget 2025, the applicable tax rate for long-term capital gains on residential prRead more
Since you held the house for 5 years, it qualifies as a long-term capital asset. This means any profit (capital gain) from the sale will be taxed as long-term capital gains. Under the current provisions effective from Budget 2025, the applicable tax rate for long-term capital gains on residential property is 12.5%.
However, if you choose to reinvest the gains into another residential property within the prescribed period (typically one year before or two years after the sale, or within three years in case of construction), you may be eligible for an exemption under Section 54. If you don’t reinvest, then you will be liable to pay tax at 12.5% on the net gain—calculated as the sale proceeds minus the adjusted purchase cost and any allowable expenses.
Hi, In the current framework of the Indian Income Tax Act, there isn’t a broad exemption for capital gains under Section 10. In the past, there was an exemption for certain long-term capital gains on the sale of listed equity shares (under what was formerly known as Section 10(38)), but that benefitRead more
Hi,
In the current framework of the Indian Income Tax Act, there isn’t a broad exemption for capital gains under Section 10. In the past, there was an exemption for certain long-term capital gains on the sale of listed equity shares (under what was formerly known as Section 10(38)), but that benefit was withdrawn a few years back with subsequent amendments.
Today, capital gains—whether short-term or long-term—are generally taxed according to the provisions specific to capital gains (such as under Sections 112A for equity and the rules applicable to real estate, debt funds, gold, etc.). However, there are specific reliefs available when you reinvest your gains in a new asset (like under Sections 54, 54EC, or 54F), but these are separate from any exemptions that might have been provided under Section 10.
In short, under the current law, you won’t find a provision in Section 10 that exempts capital gains outright.
In the Indian context—with the recent Budget 2025 changes in mind—capital gains tax is structured primarily by the asset type and the duration for which you hold the asset. Here's a handmade breakdown: For Listed Equity Shares & Equity Mutual Funds:• Short-Term Gains: If these are held for lessRead more
In the Indian context—with the recent Budget 2025 changes in mind—capital gains tax is structured primarily by the asset type and the duration for which you hold the asset. Here’s a handmade breakdown:
For Listed Equity Shares & Equity Mutual Funds: • Short-Term Gains: If these are held for less than 12 months, the gains are now taxed at 20%. • Long-Term Gains: When held for 12 months or more, gains attract a rate of 12.5%, with an exemption threshold that has been increased modestly (now around ₹1.25 lakh).
For Immovable Property (Real Estate): • Short-Term Gains: If the property is sold within 24 months, the gains are taxed as per your applicable income tax slab rates. • Long-Term Gains: For properties held longer than 24 months, the tax rate has been set at 12.5%. (Note that the traditional indexation benefit has been removed in recent changes, which simplifies the calculation.)
For Debt Mutual Funds & Gold: • Short-Term Gains: When these assets are held for less than 36 months, the gains are added to your income and taxed according to your individual slab rates. • Long-Term Gains: For holding periods of 36 months or more, the gains are generally taxed at 20%, but you still benefit from the indexation adjustment to account for inflation.
Under the Income Tax Act, depreciation is generally available only on assets that you own. Here's how this rule applies to a building taken on lease: Operating Lease:If you lease a building under an operating lease, the building remains the property of the lessor. Result: No depreciation can be claiRead more
Under the Income Tax Act, depreciation is generally available only on assets that you own. Here’s how this rule applies to a building taken on lease:
Operating Lease: If you lease a building under an operating lease, the building remains the property of the lessor.
Result: No depreciation can be claimed on the building itself since you do not own it.
Finance Lease: In cases where the lease arrangement qualifies as a finance lease, the lessee is treated, for tax purposes, as the owner of the asset.
Result: You may be eligible to claim depreciation on the leased building.
Leasehold Improvements: Even with an operating lease, if you incur expenses to improve the leased premises (and these improvements are capitalized as assets), you may claim depreciation on those improvements.
In simple terms, a block of assets is a grouping of similar assets that are used for the same business purpose, on which depreciation is calculated collectively rather than individually. This concept is crucial for ensuring a uniform method of depreciation and avoiding the cumbersome process of calcRead more
In simple terms, a block of assets is a grouping of similar assets that are used for the same business purpose, on which depreciation is calculated collectively rather than individually. This concept is crucial for ensuring a uniform method of depreciation and avoiding the cumbersome process of calculating depreciation for each asset separately.
Key Points:
Definition & Purpose: The Income Tax Act, 1961 (particularly under Section 32) groups together assets that are similar in nature and use, such as all machinery, all computers, or all vehicles used in a business, into what is called a block of assets.
This approach simplifies the calculation of depreciation by applying the same depreciation rate to the entire group.
How It Works:
Cost Accumulation: The cost of all assets in a block is combined.
Depreciation Calculation: Depreciation is then computed on the entire block’s cost, and the written down value is carried forward from one year to the next for the entire block.
Adjustments: When new assets are added or old assets are disposed of, the block’s cost is adjusted accordingly.
Benefits:
Simplification: This method reduces administrative burden, especially for businesses with a large number of similar assets.
Uniformity: It ensures consistency in how depreciation is claimed over time.
When calculating depreciation for tax purposes, the Written Down Value (WDV) method is commonly used. This method allows you to claim depreciation on an asset based on its reduced value after accounting for previous depreciation. Step-by-Step Calculation: Determine the Cost of Acquisition: Begin witRead more
When calculating depreciation for tax purposes, the Written Down Value (WDV) method is commonly used. This method allows you to claim depreciation on an asset based on its reduced value after accounting for previous depreciation.
Step-by-Step Calculation:
Determine the Cost of Acquisition:
Begin with the actual purchase price of the asset plus any incidental costs (such as installation, transportation, etc.).
This initial cost is your base cost for depreciation.
Calculate Depreciation for the Year:
Use the prescribed rate for the asset as defined under the Income Tax Act (refer to Section 32 for specific rates).
Depreciation for the Year = (Base Cost – Accumulated Depreciation) × Applicable Rate
Compute the WDV:
WDV at the End of the Year = (Cost of Acquisition) – (Total Depreciation Claimed to Date)
In simpler terms, the WDV is the original cost reduced by all the depreciation deductions that have been allowed in the previous years.
Example Illustration:
Suppose you purchase machinery for ₹10,00,000. The applicable depreciation rate for the machinery is 15% per annum.
First Year Depreciation: Depreciation = ₹10,00,000 × 15% = ₹1,50,000 WDV at end of Year 1 = ₹10,00,000 – ₹1,50,000 = ₹8,50,000
Second Year Depreciation: Depreciation = ₹8,50,000 × 15% = ₹1,27,500 WDV at end of Year 2 = ₹8,50,000 – ₹1,27,500 = ₹7,22,500
This process continues each year until the asset is fully depreciated or disposed of.
Depreciation allowance is a deduction available under Section 32 of the Income Tax Act, 1961, allowing businesses to claim a portion of the cost of assets used in their operations. This deduction recognizes the wear and tear or obsolescence of assets over time and helps in reducing taxable income. KRead more
Depreciation allowance is a deduction available under Section 32 of the Income Tax Act, 1961, allowing businesses to claim a portion of the cost of assets used in their operations. This deduction recognizes the wear and tear or obsolescence of assets over time and helps in reducing taxable income.
Key Aspects of Depreciation Allowance
1. Eligible Assets
Depreciation can be claimed on the following assets:
Tangible Assets: Buildings, machinery, plant, furniture, etc.
Intangible Assets: Patents, copyrights, trademarks, licenses, and other similar business rights.
2. Conditions for Claiming Depreciation
To avail of depreciation allowance, the following conditions must be met:
The asset must be owned (wholly or partly) by the taxpayer.
It must be used for business or professional purposes during the relevant financial year.
3. Block of Assets Concept
Depreciation is calculated based on the block of assets approach, where assets of similar nature and usage are grouped together. The entire block is subject to depreciation, rather than individual assets.
4. Depreciation Rates
The Income Tax Act specifies different depreciation rates depending on the type of asset:
Buildings: 5% (residential) or 10% (commercial)
Plant & Machinery: 15% (general machinery, higher for specific equipment)
Furniture & Fittings: 10%
Computers & Software: 40%
Intangible Assets: 25%
5. Methods of Depreciation
Written Down Value (WDV) Method: Used for most businesses where depreciation is applied to the asset’s reduced value each year.
Straight-Line Method (SLM): Available only to certain undertakings (e.g., power generation units), where depreciation is equally spread over the asset’s life.
6. Additional Depreciation
For businesses engaged in manufacturing or power generation, additional depreciation may be available on new plant and machinery, subject to conditions.
Under the Income Tax Act, depreciation is a deduction allowed for the wear and tear of tangible and intangible assets used in a business or profession. However, there are specific situations where claiming depreciation is either restricted or disallowed: Assets Not Owned by the Assessee: DepreciRead more
Under the Income Tax Act, depreciation is a deduction allowed for the wear and tear of tangible and intangible assets used in a business or profession.However, there are specific situations where claiming depreciation is either restricted or disallowed:
Assets Not Owned by the Assessee: Depreciation can only be claimed on assets that are owned, wholly or partly, by the taxpayer. If the taxpayer does not have ownership of the asset, depreciation is not permissible.
Assets Not Used for Business or Professional Purposes: The asset must be employed in the taxpayer’s business or profession during the relevant financial year. Assets held for personal use or those not put to use during the year are ineligible for depreciation claims.
Land and Goodwill: Depreciation is not allowable on land, as it does not suffer wear and tear. Similarly, following amendments effective from April 1, 2021, goodwill of a business or profession is specifically excluded from the definition of a depreciable asset, and depreciation on goodwill is disallowed.
Assets Used for Charitable or Religious Purposes: For entities claiming exemption under sections 11 and 12, if the cost of acquiring an asset has been treated as an application of income (i.e., considered as expenditure towards charitable or religious purposes), depreciation cannot be claimed on such assets to prevent double deduction.
Assets Acquired and Sold Within the Same Financial Year: If an asset is purchased and disposed of within the same financial year, it is not eligible for depreciation, as it has not been used for business purposes during the year.
Personal or Non-Business Use: Assets used exclusively for personal purposes or not utilized for business or professional activities are not eligible for depreciation under the Income Tax Act.
If your GST registration has been cancelled—either voluntarily or by the tax authorities—you may have the option to restore it if your business operations have resumed. Here’s a quick guide on how to do that: Step 1: Check the Cancellation Status and Time Limit If your registration was cancelled andRead more
If your GST registration has been cancelled—either voluntarily or by the tax authorities—you may have the option to restore it if your business operations have resumed. Here’s a quick guide on how to do that:
Step 1: Check the Cancellation Status and Time Limit
If your registration was cancelled and you wish to resume your business, you need to check whether you’re still within the allowed window for restoration.
Typically, you can apply for restoration within a prescribed period (usually within 30 days from the cancellation date). If you miss this window, you might have to register as a new taxpayer.
Step 2: Log In to the GST Portal
Visit the official GST portal and log in using your credentials.
Step 3: Submit an Application for Restoration
Navigate to the registration section and look for the option to “Restore Registration” or “Resume Registration.”
Complete the application form, providing all the required details and the reason for restoration (such as resumption of business).
Step 4: File All Pending Returns and Clear Outstanding Dues
Ensure that any pending GST returns are filed.
Settle any outstanding taxes or interest to avoid complications during the restoration process.
Step 5: Await Approval
After submitting your application, the GST authorities will review your request.
If approved, your GST registration will be restored, and you can continue with your business activities under the same GSTIN.
What are the provisions relating to computation of capital gain in case of transfer of asset by way of gift, will, etc.?
When an asset is transferred by way of gift, through a will, or by inheritance, the provisions for computing capital gains follow a “carry-forward” principle. This means: Cost of Acquisition:The cost that was originally incurred by the previous owner is carried forward. In other words, you will useRead more
When an asset is transferred by way of gift, through a will, or by inheritance, the provisions for computing capital gains follow a “carry-forward” principle. This means:
Cost of Acquisition:
The cost that was originally incurred by the previous owner is carried forward. In other words, you will use the original purchase cost (plus any improvement costs, if applicable) paid by the previous owner rather than a market value or zero-cost.
Holding Period:
The holding period of the asset is also inherited from the previous owner. This is important because if the asset had already been held for a long period (thus qualifying as a long-term asset), it will continue to be treated as such in your hands. This can have a significant impact on the applicable tax rate and the availability of indexation benefits.
Tax Implication:
When you eventually sell the asset, the capital gain is computed by subtracting the inherited cost (adjusted for inflation, if applicable) from the sale proceeds. Even though you did not pay anything for the asset at the time of receiving it, the earlier cost and holding period remain in effect for tax purposes.
This approach ensures that the tax benefits achieved by holding an asset over the long term (such as lower long-term capital gains tax rates) are not lost when the asset is transferred by gift or inheritance.
See lessI have sold a house which had been purchased by me 5 years ago. Am I required to pay any tax on the profit earned by me on account of such sale?
Since you held the house for 5 years, it qualifies as a long-term capital asset. This means any profit (capital gain) from the sale will be taxed as long-term capital gains. Under the current provisions effective from Budget 2025, the applicable tax rate for long-term capital gains on residential prRead more
Since you held the house for 5 years, it qualifies as a long-term capital asset. This means any profit (capital gain) from the sale will be taxed as long-term capital gains. Under the current provisions effective from Budget 2025, the applicable tax rate for long-term capital gains on residential property is 12.5%.
However, if you choose to reinvest the gains into another residential property within the prescribed period (typically one year before or two years after the sale, or within three years in case of construction), you may be eligible for an exemption under Section 54. If you don’t reinvest, then you will be liable to pay tax at 12.5% on the net gain—calculated as the sale proceeds minus the adjusted purchase cost and any allowable expenses.
See lessAre any capital gains exempt under section 10?
Hi, In the current framework of the Indian Income Tax Act, there isn’t a broad exemption for capital gains under Section 10. In the past, there was an exemption for certain long-term capital gains on the sale of listed equity shares (under what was formerly known as Section 10(38)), but that benefitRead more
Hi,
In the current framework of the Indian Income Tax Act, there isn’t a broad exemption for capital gains under Section 10. In the past, there was an exemption for certain long-term capital gains on the sale of listed equity shares (under what was formerly known as Section 10(38)), but that benefit was withdrawn a few years back with subsequent amendments.
Today, capital gains—whether short-term or long-term—are generally taxed according to the provisions specific to capital gains (such as under Sections 112A for equity and the rules applicable to real estate, debt funds, gold, etc.). However, there are specific reliefs available when you reinvest your gains in a new asset (like under Sections 54, 54EC, or 54F), but these are separate from any exemptions that might have been provided under Section 10.
In short, under the current law, you won’t find a provision in Section 10 that exempts capital gains outright.
See lessAt what rates capital gains are charged to tax?
In the Indian context—with the recent Budget 2025 changes in mind—capital gains tax is structured primarily by the asset type and the duration for which you hold the asset. Here's a handmade breakdown: For Listed Equity Shares & Equity Mutual Funds:• Short-Term Gains: If these are held for lessRead more
In the Indian context—with the recent Budget 2025 changes in mind—capital gains tax is structured primarily by the asset type and the duration for which you hold the asset. Here’s a handmade breakdown:
For Listed Equity Shares & Equity Mutual Funds:
• Short-Term Gains: If these are held for less than 12 months, the gains are now taxed at 20%.
• Long-Term Gains: When held for 12 months or more, gains attract a rate of 12.5%, with an exemption threshold that has been increased modestly (now around ₹1.25 lakh).
For Immovable Property (Real Estate):
• Short-Term Gains: If the property is sold within 24 months, the gains are taxed as per your applicable income tax slab rates.
• Long-Term Gains: For properties held longer than 24 months, the tax rate has been set at 12.5%. (Note that the traditional indexation benefit has been removed in recent changes, which simplifies the calculation.)
For Debt Mutual Funds & Gold:
See less• Short-Term Gains: When these assets are held for less than 36 months, the gains are added to your income and taxed according to your individual slab rates.
• Long-Term Gains: For holding periods of 36 months or more, the gains are generally taxed at 20%, but you still benefit from the indexation adjustment to account for inflation.
Whether deduction of depreciation is allowed on building taken on lease?
Under the Income Tax Act, depreciation is generally available only on assets that you own. Here's how this rule applies to a building taken on lease: Operating Lease:If you lease a building under an operating lease, the building remains the property of the lessor. Result: No depreciation can be claiRead more
Under the Income Tax Act, depreciation is generally available only on assets that you own. Here’s how this rule applies to a building taken on lease:
-
-
-
-
-
See lessOperating Lease:
If you lease a building under an operating lease, the building remains the property of the lessor.
Result: No depreciation can be claimed on the building itself since you do not own it.
Finance Lease:
In cases where the lease arrangement qualifies as a finance lease, the lessee is treated, for tax purposes, as the owner of the asset.
Result: You may be eligible to claim depreciation on the leased building.
Leasehold Improvements:
Even with an operating lease, if you incur expenses to improve the leased premises (and these improvements are capitalized as assets), you may claim depreciation on those improvements.
What is block of assets as per Income Tax Act?
In simple terms, a block of assets is a grouping of similar assets that are used for the same business purpose, on which depreciation is calculated collectively rather than individually. This concept is crucial for ensuring a uniform method of depreciation and avoiding the cumbersome process of calcRead more
In simple terms, a block of assets is a grouping of similar assets that are used for the same business purpose, on which depreciation is calculated collectively rather than individually. This concept is crucial for ensuring a uniform method of depreciation and avoiding the cumbersome process of calculating depreciation for each asset separately.
Key Points:
-
-
-
-
-
-
-
-
-
See lessDefinition & Purpose:
The Income Tax Act, 1961 (particularly under Section 32) groups together assets that are similar in nature and use, such as all machinery, all computers, or all vehicles used in a business, into what is called a block of assets.
This approach simplifies the calculation of depreciation by applying the same depreciation rate to the entire group.
How It Works:
Cost Accumulation: The cost of all assets in a block is combined.
Depreciation Calculation: Depreciation is then computed on the entire block’s cost, and the written down value is carried forward from one year to the next for the entire block.
Adjustments: When new assets are added or old assets are disposed of, the block’s cost is adjusted accordingly.
Benefits:
Simplification: This method reduces administrative burden, especially for businesses with a large number of similar assets.
Uniformity: It ensures consistency in how depreciation is claimed over time.
How to calculate WDV of an assets as per Income Tax Act?
When calculating depreciation for tax purposes, the Written Down Value (WDV) method is commonly used. This method allows you to claim depreciation on an asset based on its reduced value after accounting for previous depreciation. Step-by-Step Calculation: Determine the Cost of Acquisition: Begin witRead more
When calculating depreciation for tax purposes, the Written Down Value (WDV) method is commonly used. This method allows you to claim depreciation on an asset based on its reduced value after accounting for previous depreciation.
Step-by-Step Calculation:
Determine the Cost of Acquisition:
Begin with the actual purchase price of the asset plus any incidental costs (such as installation, transportation, etc.).
This initial cost is your base cost for depreciation.
Calculate Depreciation for the Year:
Use the prescribed rate for the asset as defined under the Income Tax Act (refer to Section 32 for specific rates).
Depreciation for the Year = (Base Cost – Accumulated Depreciation) × Applicable Rate
Compute the WDV:
WDV at the End of the Year = (Cost of Acquisition) – (Total Depreciation Claimed to Date)
In simpler terms, the WDV is the original cost reduced by all the depreciation deductions that have been allowed in the previous years.
Example Illustration:
Suppose you purchase machinery for ₹10,00,000. The applicable depreciation rate for the machinery is 15% per annum.
First Year Depreciation:
Depreciation = ₹10,00,000 × 15% = ₹1,50,000
WDV at end of Year 1 = ₹10,00,000 – ₹1,50,000 = ₹8,50,000
Second Year Depreciation:
Depreciation = ₹8,50,000 × 15% = ₹1,27,500
WDV at end of Year 2 = ₹8,50,000 – ₹1,27,500 = ₹7,22,500
This process continues each year until the asset is fully depreciated or disposed of.
See lessWhat is depreciation allowance as per Income Tax Act?
Depreciation allowance is a deduction available under Section 32 of the Income Tax Act, 1961, allowing businesses to claim a portion of the cost of assets used in their operations. This deduction recognizes the wear and tear or obsolescence of assets over time and helps in reducing taxable income. KRead more
Depreciation allowance is a deduction available under Section 32 of the Income Tax Act, 1961, allowing businesses to claim a portion of the cost of assets used in their operations. This deduction recognizes the wear and tear or obsolescence of assets over time and helps in reducing taxable income.
Key Aspects of Depreciation Allowance
1. Eligible Assets
Depreciation can be claimed on the following assets:
Tangible Assets: Buildings, machinery, plant, furniture, etc.
Intangible Assets: Patents, copyrights, trademarks, licenses, and other similar business rights.
2. Conditions for Claiming Depreciation
To avail of depreciation allowance, the following conditions must be met:
The asset must be owned (wholly or partly) by the taxpayer.
It must be used for business or professional purposes during the relevant financial year.
3. Block of Assets Concept
Depreciation is calculated based on the block of assets approach, where assets of similar nature and usage are grouped together. The entire block is subject to depreciation, rather than individual assets.
4. Depreciation Rates
The Income Tax Act specifies different depreciation rates depending on the type of asset:
Buildings: 5% (residential) or 10% (commercial)
Plant & Machinery: 15% (general machinery, higher for specific equipment)
Furniture & Fittings: 10%
Computers & Software: 40%
Intangible Assets: 25%
5. Methods of Depreciation
Written Down Value (WDV) Method: Used for most businesses where depreciation is applied to the asset’s reduced value each year.
Straight-Line Method (SLM): Available only to certain undertakings (e.g., power generation units), where depreciation is equally spread over the asset’s life.
6. Additional Depreciation
For businesses engaged in manufacturing or power generation, additional depreciation may be available on new plant and machinery, subject to conditions.
See lessWhat are the situations wherein deduction of depreciation is not allowed as per Income Tax Act?
Under the Income Tax Act, depreciation is a deduction allowed for the wear and tear of tangible and intangible assets used in a business or profession. However, there are specific situations where claiming depreciation is either restricted or disallowed: Assets Not Owned by the Assessee: DepreciRead more
Under the Income Tax Act, depreciation is a deduction allowed for the wear and tear of tangible and intangible assets used in a business or profession. However, there are specific situations where claiming depreciation is either restricted or disallowed:
-
-
-
-
-
-
See lessAssets Not Owned by the Assessee: Depreciation can only be claimed on assets that are owned, wholly or partly, by the taxpayer. If the taxpayer does not have ownership of the asset, depreciation is not permissible.
Assets Not Used for Business or Professional Purposes: The asset must be employed in the taxpayer’s business or profession during the relevant financial year. Assets held for personal use or those not put to use during the year are ineligible for depreciation claims.
Land and Goodwill: Depreciation is not allowable on land, as it does not suffer wear and tear. Similarly, following amendments effective from April 1, 2021, goodwill of a business or profession is specifically excluded from the definition of a depreciable asset, and depreciation on goodwill is disallowed.
Assets Used for Charitable or Religious Purposes: For entities claiming exemption under sections 11 and 12, if the cost of acquiring an asset has been treated as an application of income (i.e., considered as expenditure towards charitable or religious purposes), depreciation cannot be claimed on such assets to prevent double deduction.
Assets Acquired and Sold Within the Same Financial Year: If an asset is purchased and disposed of within the same financial year, it is not eligible for depreciation, as it has not been used for business purposes during the year.
Personal or Non-Business Use: Assets used exclusively for personal purposes or not utilized for business or professional activities are not eligible for depreciation under the Income Tax Act.
How to resume cancelled GST registration?
If your GST registration has been cancelled—either voluntarily or by the tax authorities—you may have the option to restore it if your business operations have resumed. Here’s a quick guide on how to do that: Step 1: Check the Cancellation Status and Time Limit If your registration was cancelled andRead more
If your GST registration has been cancelled—either voluntarily or by the tax authorities—you may have the option to restore it if your business operations have resumed. Here’s a quick guide on how to do that:
Step 1: Check the Cancellation Status and Time Limit
If your registration was cancelled and you wish to resume your business, you need to check whether you’re still within the allowed window for restoration.
Typically, you can apply for restoration within a prescribed period (usually within 30 days from the cancellation date). If you miss this window, you might have to register as a new taxpayer.
Step 2: Log In to the GST Portal
Visit the official GST portal and log in using your credentials.
Step 3: Submit an Application for Restoration
Navigate to the registration section and look for the option to “Restore Registration” or “Resume Registration.”
Complete the application form, providing all the required details and the reason for restoration (such as resumption of business).
Step 4: File All Pending Returns and Clear Outstanding Dues
Ensure that any pending GST returns are filed.
Settle any outstanding taxes or interest to avoid complications during the restoration process.
Step 5: Await Approval
-
-
See lessAfter submitting your application, the GST authorities will review your request.
If approved, your GST registration will be restored, and you can continue with your business activities under the same GSTIN.