Hi! I would like to ask if employment visa charges can be capitalized as part of asset to be amortized?

Question

Example, i hired an expat employee. I incurred employment visa expenses and other related employment expenses for him. Can i capitalized it as part of prepayments which can be amortized? If it can be, what is the related IFRS standards? Thank you.

Answer 1

If you paid visa fees for an H1-B visa for an employee, those are legitimate business expenses and can be deducted in the year that the fees were paid or that you became liable for their payment, depending upon your accounting method.

An employee isn't a asset as far as the tax laws are concerned so the employment costs are not amortized or depreciated, they are written off in total when they are expensed.