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Depreciation rates chart as per Income Tax Act for 2013-14

Updated on November 11, 2014
Burden of Tax
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Depreciation Rates Chart as per Indian Income Tax Act, 1961-

ASSET CLASS
BLOCK NUMBER
SUB ITEM NUMBER
ASSET TYPE
RATE OF DEPRECIATION
Building
Block-01
i.
All Residential buildings except hotels and boarding houses
5%
Building
Block-02
ii.
Other than Residential buildings (not covered in Block No.1 &3)
10%
Building
Block-03
i.
Building acquired on or after 01st Sep,2002 for installing P&M forming part of water supply project or water treatment system and which is put to use for the purpose of business of providing infrastructure facilities u/s 80-IA(4)(i)
100%
Building
Block-03
ii.
Purely temporary erections such as wooden structures
100%
Furniture
Block-04
i.
Furniture - Any furniture / fittings including electrical fittings
10%
Plant & Machinery
Block-05
i.
Motor cars other than those used in a business of running them on hire
15%
Plant & Machinery
Block-05
ii.
P&M other those covered in block no. 6 to 11 below.
15%
Plant & Machinery
Block-06
i.
Motor buses/taxies/lorries used in a business of running them on hire
30%
Plant & Machinery
Block-06
ii.
Moulds used in plastic and rubber factories
30%
Plant & Machinery
Block-06
iii.
P&M used in semi-conductor industry other than those covered in Block no. 11 below
30%
Plant & Machinery
Block-07
i.
Aero planes-Aero engines
40%
Plant & Machinery
Block-07
ii.
Commercial vehicle acquired on or after 01st Oct,1998 but before 01st Apr,1999 and is put to used before 01st Apr,1999 for purpose of Business or Profession (B or P)
40%
Plant & Machinery
Block-07
iii.
Specified lifesaving medical equipment
40%
Plant & Machinery
Block-08
i.
New commercial vehicle acquired/purchased on or after 01st Apr 2001 but before 01st Apr,2002 and put to use before 01st Apr,2002 for (B or P)
50%
Plant & Machinery
Block-08
ii.
New commercial vehicle acquired/purchased on or after 01st Jan,2009 but before 01st Oct,2009 and put to use before 01st Oct,2009 for (B or P)
50%
Plant & Machinery
Block-08
iii.
Glass or Plastic containers used as re-fills
50%
Plant & Machinery
Block-08
iv.
P&M used in weaving , processing and garment sector of textile industry purchased under TUFS on or after 01st Apr,2001 but before 01st Apr,2004 and put to use before 01st Apr,2004
50%
Plant & Machinery
Block-09
i.
Computers and computer software
60%
Plant & Machinery
Block-09
ii.
Books owned by professional (other than annual publications=or books owned by assesses carrying on business in running lending libraries)
60%
Plant & Machinery
Block-09
iii.
Gas cylinder , valves and regulators. Direct fire glass melting furnaces, Plant used in filed operations distribution above/below ground but not include curbside pumps & underground tanks and fittings used in field operations (distribution) by mineral oil concerns.
60%
Plant & Machinery
Block-10
i.
Energy saving and renewal energy devices, Rollers used in flour mills and sugar works, Rolling mill rolls used in iron and steel industry.
80%
Plant & Machinery
Block-11
i.
P&M acquired and installed on or after 01st Sep,2002 in water supply project or a water treatment system and put to use for the purpose of business of providing infrastructure facility u/s 80-IA(4)(i).
100%
Plant & Machinery
Block-11
ii.
Wooden parts used in artificial silk manufacturing machinery
100%
Plant & Machinery
Block-11
iii.
Cinematograph films- bulbs of studio lights.
100%
Plant & Machinery
Block-11
iv.
Mach factories-wooden match frames.
100%
Plant & Machinery
Block-11
v.
Windnig ropes , Tubes , haulage ropes and sand stowing pipes, and safety lamps used in mines and quarries
100%
Plant & Machinery
Block-11
vi.
Salt works-Salt pans, reservoirs and condensers , etc. made of earthy, sandy or clayey material or any other similar material
100%
Plant & Machinery
Block-11
vii.
Books owned by assesses carrying on a profession , being annual publications.
100%
Plant & Machinery
Block-11
viii.
Books owned by assesses carrying on business in running lending libraries.
100%
Plant & Machinery
Block-11
ix.
Water pollution, Air Pollution control equipment, control equipment, solid waste control equipment, solid waste recycling and resource recovery systems.
100%
Ships
Block-12
i.
Ocean going ships
20%
Ships
Block-12
ii.
Vessels ordinarily operating on inland waters, not covered in below items
20%
Ships
Block-12
iii.
Vessels ordinarily operating on inland waters being speed boats.
20%
Intangible Assets
Block-13
i.
Know-how, patents, copyrights, trademarks, licences, franchisees or any other business or commercial rights of similar nature.
25%
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Save Income Tax in India A.Y. 2013-14-

Additional Notes on Depreciation-

DEPRECIATION (BASIC POINTS)

  • Assesse must be owner of the asset & used in business or profession.
  • He may not be registered owner of the asset.
  • Here only WDV method is used under Block of assets concept, unless block becomes empty or WDV becomes 0.
  • In case of amalgamation, merger etc., no. of days used to taken to cal. depreciation.
  • Depreciation Is charged if asset can be used, i.e “Ready to use”, whether actually used or not.
  • Half dep. If used for less than 180 days & no dep. In year of sale of asset.
  • Dep. Of 5% is charged on residential buildings used for business purposes.
  • Only actual money received on sale of asset is deducted in block, not the benefits which can’t be converted in money.
  • Depreciation is allowed even if it is not claimed by the assesse.
  • Dep. Is cal. Only on asset. Asset is one which can give future benefits (irrespective of the amt.)
  • Value of asset includes purchase cost + costs incurred to make machinery ready to use + interest paid on loan taken to purchase machinery, but only int. paid before machinery was put to use.
  • If dep. Is not fully absorbed, it can be set off & carry f/w. to infinite no. of years & continuing of business is not important/required for it.
  • Additional Depreciation-
  1. Available only if assesse fulfills three conditions-

a) Assesse must be engaged in manufacturer/production of an article or thing.

b) Only available in first year of purchase.

c) It should be eligible plant & machinery.

d) It should be not building, furniture & old P&M.

e) Rate- 20% p.a , if less than 180 days, 10 % p.a.

f) Eligible P&M is one which is not ships & aircraft ,mach. Used outside india, machinery in office premises & furniture and buildings, power generating unit, mach. With 100% dep.

  • Dep. Of asset under-

Lease-

a) If lessee has done a capital exp. in a building, he can claim dep. On that part.

Otherwise, only lessor can claim dep. On his assets leased.

b) Exception- If lessee in case of financial lease can exercise the rights of the owner not on behalf of lessor but in his own right, dep. is available to lessee.

Hire-purchase-

a) Seller has the right to claim depreciation unless-

  • Ø H.p agreement gives right to hirer over asset for all practical purposes. +
  • Ø Hirer has paid all installments to seller.

Then he can claim dep.

DEP. IN CASE OF POWER GENERATING UNITS

  • SLM-
  1. If PGU sold below WDV, the loss will be treated as terminal depreciation.
  2. If asset sold over & above WDV, surplus is balancing charge.
  3. If asset sold above cost of asset, the over & above amount will be STCG.


  • WDV-
  1. If PGU sold below WDV, treated as loss & sent to P/L ac.
  2. No Balancing charge & STCG here.
  3. Any profit is simply taxable as business profit.
  • Notes related to above 2-
    • Ø All rules of 180 days are still applicable.
    • Ø If asset sold in P.Y in which it was put to use, then no T. Dep. & B.C, any loss= STCL & profit= STCG.

Characteristics which a fixed asset should have-

  • Ø Asset should be able to give future benefits.
  • Ø It is not a routine expenditure.
  • Ø Cap. Exp. improves the existing capacity of the asset.
  • Ø It should be non-recurring in nature.
  • Ø Amount of the exp. & its mode of payment cannot decide the nature of the asset.

Eg.- Fluorescent lights installed for the 1st time in office is a capital exp. but all subsequent replacement of lights is a revenue expenditure.

Taxability under the Income tax act 1961

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