• Jul
  • 14
  • 2010

Rates of Depreciation as Per Income Tax Act

  1. Block of Assets

The expressions Assets and Blocks of Assets w.e.f. 1-4-1999 shall mean a group of assets falling within a class of assets comprising:–

  1. Tangible Assets being buildings, machinery, plant or furniture;

  2. Intangible Assets being knowhow, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature; in respect of which same percentage of depreciations is prescribed.

Rates of Depreciation (Applicable w.e.f.
A.Y. 2006-07
, Refer Notification No. 67/2005
dt. 28th February, 2005 w.e.f. 2-4-2005)
RATE %

I

Buildings : (See Note 2)    

1

Buildings which are used mainly for residential purposes except hotels and Boarding House 5

2

Buildings which are not used mainly for residential purposes and other than mentioned in 1 & 3 10

3

Buildings acquired on or after 1-9-2002 for installing P & M forming part of water supply project or water treatment system and put to use for the purpose of providing infrastructure facilities u/s. 80-IA(4)(i) 100
4 Purely  temporary  erections  such  as  wooden structures. 100
II Furniture and fittings including electrical fittings 10
III Machinery and plant : (See Note 3)  
1 Machinery and plant other than those covered by sub-items 2, 3 and 8 below 15
2 Motor-cars (other than those used in business of running  them on hire) acquired or put to use on or after 1st April, 1990. 15
3 i. Aeroplane — Aeroengines 40
  ii. Motor buses, Motor lorries and Motor taxies used in a business of running them on hire. 30
  iii.

Commercial vehicle acquired on or after 1.10.1998 but before 1.4.1999 and is put to use before 1.4.1999 for the purposes of business or profession.

40
  iv. New commercial vehicle acquired on or after 1.10.1998 but before 1.4.1999 and is put to use before 1.4.1999 in replacement of condemned vehicle of over 15 years of
age for the purpose of business or profession.
60
  v.

 New commercial vehicle acquired on or after 1.4.1999 but before 1.4.2000 in replacement of condemned vehicle of over 15 years of age and is put to use before 1.4.2000 for the purpose of business or profession.

 60
  vi. New commercial vehicles acquired on or after 1-4-2001 but before 1-4-2002 and is put to use before 1-4-2002 for the purpose of business or profession. 50
vi.a) New commercial vehicle acquired on or after 1-1-2009 but before 1-4-2009 and put to use before 1-4-2009 for the business or profession 50
  vii. Moulds used in rubber and plastic goods factories 30
  viii. Air pollution control equipments 100
  ix. Water pollution control equipments 100
  x. Solid waste control equipments 100
  xi. P & M used in semi-conductor industry 30
  xi.a) Life saving medical equipments
(For Items refer to Rule 5 App. I)
40
4

Containers made of glass or plastic used as refills

50
5

Computers (including computer software)

60
6

Machinery and plants used in weaving processing, and garment sector of textile industry purchased under TUFS on or after 1-4-2001 but before 1-4-2004 and is put to use before 1-4-2004

50
7&8.

For other items of P & M refer to Rule 5 App. 1

100/80/60
9 i. Books owned by assessees carrying on a profession  
    a. Annual publication 100
    b. Other books 60
  ii. Books owned by assessees carrying on business in running lending libraries  100
IV Ships    
  Refer  to Rule-5 App.-I 20
V Intangible Assets  
  Knowhow, patents, copyrights, trademarks, licences, franchises or any other business or commercial rights of similar nature acquired on or after 1.4.1998. 25

NOTES :

  1. Where an asset is put to use for less than 180 days in a previous year in which it is purchased, depreciation thereon shall be allowed at 50% of the depreciation allowable in respect of the block of asset comprising such asset.

  2. Buildings include roads, bridges, culverts, wells and tubewells

  3. Plant has been held to include:

  • movable partitions [Jarrold vs. John Good & Sons Ltd., 40 TC 681 (CA)]

  • sanitary & pipeline fitting [CIT vs. Taj Mahal Hotel, 82 ITR 44 (SC)]

  • ceiling and pedestal fans [CIT vs. Jagadees Chandran & Co., 75 ITR 697 (Mad.); Sundaram Motors Pvt. Ltd. vs. CIT, 71 ITR 587 (Mad.); CIT vs. Tarun Commercial Ltd., 151 ITR 75 (Guj)].

  • wells [CIT vs. Warner Hindustan Ltd., 117 ITR 15 (AP)].

  • hospital [CIT vs. Dr. B. Venkata Rao 111 Taxman 635 (SC)]. However, w.e.f. A.Y. 2004-05, it shall not include buildings, furniture and fittings.

  1. Depreciation on assets acquired on hire purchase basis should be allowed to the hirer where the terms of the agreement provide that the equipment shall eventually become the property of the hirer or confer on the hirer an option to purchase the equipment [Circular No. 9 (R. Dis. No. 27(4) - IT/43), dated 23-3-1943].

  2. Depreciation in respect of motor car manufactured outside India acquired on or after 28-2-1975 or before 1-4-2001 shall be allowed.

  3. The claim of depreciation is mandatory w.e.f. A. Y. 2002-03 overriding Supreme Court’s decision in CIT vs. Mahendra Mills 109 Taxman 225 which held that the depreciation claim is optional.

  4. Total depreciation allowable in the year of succession/ amalgamation/demerger, to predecessor/amalgamating/ demerged co. and successor/amalgamated/resulting co. is to be restricted to depreciation allowable as if succession/ amalgamation/demerger had not taken place, and such depreciation is to be apportioned on the basis of number of days usage by each of them.

  5. Depreciation is allowable even on jointly owned assets.

  6. No amortisation benefits u/ss. 35A and 35AB can be claimed in respect of intangible assets.

  7. In respect of depreciable assets employed in power projects, depreciation may be computed under the Straight Line Method on individual assets [Rule 5(1A)] — [Appendix IA]. Alternatively, the undertaking, may at its option, also claim depreciation at the normal rates (Rule 5(1) — Appendix I), subject to the option being exercised prior to the due date of filing the return of income. In the event of sale or disposal of such assets, if the sale consideration.

  1. is less than WDV of such assets– Balance (i.e., WDV – sale consideration) can be claimed as depreciation, provided that such a deficiency is written off in the books.

  2. is in excess of the WDV — Excess (to the extent of the difference between actual cost and WDV will be taxable as Business profit and the balance as Capital Gains)

  1. Additional Depreciation @ 20% of actual cost of new machinery or plant (other than ships and aircrafts) acquired and installed after 31st March, 2005 by an assessee engaged in the business of manufacture or production of an article or thing shall be allowed on satisfying certain conditions.


74 Responses to “Rates of Depreciation as Per Income Tax Act”

  1. Rajesh Kumar says:

    Dear Sir,

    if we purchase computer on 21.03.2014 how much depreciation charge on it as per income tax act. because 60% depreciation charges if we used more than 180 days.

    thanks

  2. D.nagabhushan says:

    Sir,

    Please let me know whether sports items like bats and balls etc. can be classified under assets account and depreciation can be calculated.

  3. Suresh Dash says:

    Dear Sir,please tell me what is the rate of depreciation of hydraulic excavator crawler mounted engaged on hire basis.The excavator not required registration from RTO.THis is heavy earth moving equipment engaged in construction..

    With regards.

    Suresh Dash.
    Mobile No.+918584020999

  4. Saurabh Verma says:

    Is amortization of lease rights of leasehold land allowed in Income Tax Act(IT Act)?

    if yes, how will be show the difference in WDV as per ROC and as per IT Act in the computation of deferred tax asset / Liability. Because we cannot show the same in the Depreciation chart of IT Act as there is no specific rate given for the same and ITR-VI will not take this.

    please suggest me

    thanks & Regards,
    Saurabh Verma
    CA-Final Student

  5. CHHAVI RAI says:

    PLEAS SUGGEST THE RATE OF DEPRICIATION ON XEROX MACHINE USED FOROFFICIALPURPOSE.

    Thanks & Regards

  6. Sandeep Jha says:

    Sir,

    Kindly send me the date and notification no. for changed the rate of depreciation on Containers made of glass or plastic used as refills from 100% to 50%.

  7. MITHUN BEHERA says:

    Rate of Depreciation on Lab rotary equipment of a residential educational institution.

    Please sent me the answer of the above question quickly, because now I am going to finalize the accounts of a college.

    Thanks

  8. Pooja chakave says:

    what is depriciation rate of the CCTV camera ?

  9. MANAN says:

    rate of depreciation for mobile?

  10. sudhir kamble says:

    pls mail me the rate of dep. on xerox machine

  11. Deepak Bisht says:

    i purchase a car rs.15 lac…for year 2012-2013. so plse charge of Dep.?

  12. Amar says:

    I purchased solar system for electricity at my building so i want to know that what i charge depreciation on that equipment and what is the tax benifit on that.

  13. somu says:

    i have purchased car how to claim depreciation and how many percentage

  14. lalit modi says:

    HOW DECIDE THAT RATE OF DEPRICIATION ON
    X-RAY ROOM
    HOSPITAL
    MULTIPLEX CINEMA HALL
    SINGLE SCREEN CINEMA HALL

    WHAT WE INCLUDED ABOVE IN PLANT OR BUILDING?

  15. Jay Parikh says:

    Car purchased on 1st January . Cost is Rs. 421921/-. Pls inf amount of depreciation.

  16. Ranjit Patra says:

    I would like to know a company having plan for setting up a grid intractive (5MW) solar power project in FY 13-14, whether they will be elligible for accelerated depriciation if so what is the rate% and this is available under which act of Income Tax.

    I will be happy if any body can provide me any notification copy on the above.

  17. Preethi.V says:

    I had a Question for you. What is the rate of depreciation for a generator purchased before 30.09.2012 by a non-corporate assessee?

  18. Preethi.V says:

    I Had A question for You. What is the rate of depreciation for the generator purchased before 30/09/2012 by a Non-corporate assesee?

  19. Dhaval Nathwani says:

    Hello Sir,

    We have got the notification from Income Tax regarding Wind Mill Installation, Stating
    CBDT has amended the income tax rules to restrict the depreciation allowed on windmills installed after 1 April, 2012 to 15 %. This was 80% for the windmills installed on or before 31st March, 2012.

    My question is If you see the above statement it is contradictory in first statement they are saying wind mill Installed after 1 April, 2012 to 15 % and in next statement they are saying, This was 80% for the windmills installed on or before 31st March, 2012.

    So Sir for our accounting purpose should we take a deduction for Depreciation of 80% or 15%, as we have purchased wind mill on 31/03/2010 date please advise.

    Thanking you

    Regards,

  20. Rajesh Ranjan says:

    I would like to know the depreciation cost of the Laptop as on June 2012, which purchased in March 2011 at the coast of Rs. 70,000/-. Pls help

  21. chetan bhargav says:

    I am a senior citizen. I have purchased a new car for my personal use. I am not doing any business and am dependent on interst income. Am i entitled to claim depraction on the car under the income tax act. Please advice me as soon as possible.
    Thanking you,
    Ravi Bhargav

  22. alok jain says:

    Dear sir,

    plz send me depreciation rate in Excel format

    Thanks

    Alok jain

  23. Money jain says:

    what is the depreciation rate on fire fighting equipments?

  24. C. YARRAIAH - 0 99499 88998. 95055 08265 says:

    we have hospital building with lift, generators, escalators, transformer, air conditioners, electrical fittings, cctv, stp. can we show all these items under building or we need to show seperately?
    as per income tax act for the purpose of deprecaition.
    pl advise

  25. khushi says:

    I Want to required all details of those assets are applicable or not applicable for Depreciation(with Current Rate)?

  26. bhanu says:

    I Want to required all details of those assets are applicable or not applicable for Depreciation(with Current Rate)?

  27. Paresh says:

    need the depreciation rate according to income tax act and companies act in excel sheet on every assets and how to calculate .

  28. ANIL KUMAR.V.K says:

    I Want to required all details of those assets are applicable or not applicable for Depreciation(with Current Rate)?

  29. sc rawat says:

    w e are a partnership firm – natre of business training & development, since november 2011.   partners are A  and B, the business is being carried out from a (other wise vacant) residential house jointly owned by A & C (C is husband of A and is in govt service, the family lives in govt accomodation).   Half portion of the the house along with the furniture and fittings, is exclusively used for the business of the firm, remaining half is lying vacant. can the firm claim depreciation on 50 % of 50 %  on the value of the assets (50 % being share of  A and  50 % being the property in use by the firm .  please advise. the  house and the furniture etc were bought in the year  2002  rawat

  30. Abhay Yadav says:

    What would be the depreciation rate to be taken in the case of books owned by college.

  31. Anjali Devraj says:

    i need the depreciation rate according to income tax act and companies act in excel sheet on every assets and how to calculate to it…………

  32. b senapati says:

    Sir,
    My company purchased a car on 4/2/2005 which is being used by me for Rs 324431\- . What will be its depreciation value as per Income tax rules as on 04/02/2008?

    Can you send the reply?
    Thanks,

  33. SACHIN NALAWADE says:

    Respected Sir /Madam

    I Want to required all details of those assets are applicable or not applicable for Depreciation(with Current Rate)

  34. Preetam Singh says:

    hi Sir/Mem
    I Want To understand the depreciation So plz sir Some knowledge provide me.

  35. Arun says:

    Yes. It is allowed at 100% provided the cost of aquisition of the asset is not more the Rs.5,000/-

  36. Dipak Mehta says:

    Dear Sir, shall i kknow from which year the rate of depreciation changed from 33.33% to 25% on plant & machinary? please consider my request.Thank You.

  37. Dipak Mehta says:

    shall i know from which year the rate of depreciation changed from 33.33% to 25% on plant and machinery? please consider my request.

  38. shree says:

    how to calculate the actual amount of fixed assets, actual balance sheet amount is 1,50,000/- i don’t know 10 % how it calculate i want actual 10 % depreciation amount please suggest me sir

  39. Md Mobarak Hussain says:

    Dear sir ,

    pls explain me how to calculate the depreciation ….

    and pls explain what is the difference between IT Depreciation & Company Act Depreciation and which is better..

    pls reply soon

  40. kumar says:

    Refer,
    Your state Biomass tariff schedule given by the concerned Renewable Dept.There you will get the details of Accelerated Depreciation information.

  41. Purnachandra Prasad says:

    Can we claim depreciation for a lease hold land ?
    Please reply

    Thanks
    Prasad

  42. NEERAJ UPPAL says:

    Please send me rates of depreciation for the Financila Year 2010-11 & All rates of VAT & VAT 24 Form

    Thanking You

    NEERAJ UPPAL
    GURDASPUR

  43. mansi says:

    if i am a sports professional:

    a. Which return would i use – ITR 4?
    b. my sports equipments would be classified as assets
    c. what rate of depreciation would apply on same

  44. ajay rai says:

    sir,

    plz send vat form 24 and vat charge on tractors.

  45. ajay rai says:

    tractors/spares ka vat percentage kya hai.

  46. dinesh says:

    depreciation rate as per income tax law on fire fighting equipments

  47. Vivek Sharma says:

    If library is being used for business and profession, then 60% depreciation can be claimed . In case of periodicals 100 depreciation can be used.

  48. Vivek Sharma says:

    Highest rate of depreciation is 100% for temporary wooden structure

  49. Vivek Sharma says:

    The depreciation on computers as per Income Tax Act, 1961 is 60% under WDV method

  50. Abhijit roy says:

    Please tell me the rate of depreciation of computer , as we know the depreciation rate is 33.33%.

  51. srinivasa reddy says:

    ur question not clear!, what star one hair?

  52. vilas gondal says:

    What is the highest rate of Depreciation under Income Tax and for what items?
    please give chart

  53. pavithra says:

    Please replay me the rare of depreciation on star one hair in yellow board

  54. k nand kishore says:

    I learnt some where in books relating to Taxation in India that in case the value of depreciable asset is Rs. 5000 or less depreciation can be claimed @ 100 % regardless of the category of the depreciable asset. Can any one give a detailed clarification on this particular aspect of depreciation ?

  55. Shraddha says:

    Please confirm the rate of depreciation for Plant & Machinery used in manufacture of Solar Panel. Is it 80%

  56. Sudarshan Kale says:

    please send depriciation excel format sir (A Y 2011-12)

  57. k kalirajan says:

    I’m K.Kalirajan from Trichirapalli, Tamil nadu . Interested to instaingl Solar Air conditioner for my home. When I refer internet, benefit of income tax thro 100% depreciation is shown by some companies.. Is it for individual also?
    Kindly clarify, if i install solar A/c for my home, am I eligible to claim this benefit?

  58. Chandan Chaudhary says:

    please send the formula of calculate interest of RD Monthly Deposit

  59. vipin says:

    in case of schools what will be the depreciation rate for sports items and books and periodicals for the A.Y. 2010-11

  60. rama says:

    what is the benefit of accelerated dep for a new biomass power company.
    what is its effect on tariff if any.

  61. Purvi says:

    Dear Sir,

    At the time of Sell of any Fixed Asset we have to take depriciated value as pe Co’s act or as per Imcome tax act?

    Is there any accounting practice that we have to maintain depriciation as per co’s act as well as as per income tax.

    Kindly suggest.

    Thanks & Regards.

  62. malathesh says:

    Dear Sir,
    Please reply me about the rate of depreciation on new factory building & plant & machinery under partnership act, extensionof unit,
    thanking you,
    with regards
    n.k.malathesh

  63. MANISH says:

    wht rate of depriciation be charged on library books in case of college or trust?

  64. Rohit Kumar says:

    Pls send me format in excel sheet for depreciation calculation and how to calculate

  65. rahul says:

    please send me all fixassets depriciation rate for assessment year 2010-2011

  66. vinod says:

    please send depriciation excel format sir

  67. bhawna says:

    can you tell me celing fans will come under furnitures or in office equipments.tell the rates of dep plz.

  68. PANKAJ KR NIMESH says:

    HOW DECIDE THAT RATE OF DEPRICIATION (COMPUTER DEP. 60%)

  69. Amit Sharma says:

    Dear Sir

    Please send me p.f calculation sheet in excel format.

    Thans

  70. Amit Sharma says:

    Dear sir

    Pls send me format in excel sheet for depreciation calculation and how to calculate

    Thanks

  71. Amit Sharma says:

    Sir

    I have a passenger cng auto i want to know that how is depriciation rate on it.

    Thans

  72. Shraddha Rao says:

    Please inform me the tax suitabilities for the manufacturer of LED products where by the buyer is able to save power by more than 60%.
    reply ASAP.

  73. Uttam says:

    Pls send me format in excel sheet for depreciation calculation and how to calculate

  74. KN.MUTHIAH says:

    Windmills are eligible for Accelerated depreciation at 80%.Presently if you want to get generation based incentive you are not eligible to claim accelerated depreciation.
    In this situation what is the normal rate of depreciation allowable for WINDMILLS.

    Kindly give your advice and I will be thankful.

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