Sole proprietorship construction property
In my sole proprietorship, which deals in IT services, I am thinking to construct property.
I have ideas for two types of property to construct:
- Office space for my sole proprietorship (including purchase of plot).
- Rental property on a plot that I own.
Are these valid expenses for a sole proprietorship (the sole proprietorship's income will be reduced by the amounts spent on the property), or is there something I need to be aware of?
What is the status of this property if I chose to close down my sole proprietorship in the future?
Asked 2 years ago in Income Tax
Thank you for good input.
I would like to understand capital expenses and fixed assets. How do they impact income taxes in the sole proprietorship?
An example for a FY:
* Revenue is 50 lakh
* Salaries, office rental, etc amounts to 20 lakh
* Remaining 30 lakh are spent on construction of office space (or rental property)
What will be the income taxes for this FY? (and, is it the same for any kind of capital expenses, e.g. if sole proprietor takes car for business?)
Asked 2 years ago