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  • Depreciation Rates for AY 2015-16

    What is Depreciation?

    Depreciation refers to the decrease in value of an asset over a period of time. During the computation of gains and profits from profession or business, taxpayers are allowed to claim depreciation on assets that were acquired and used in their profession or business. The Income Tax Act, 1962, has made it mandatory to calculate depreciation. Following are the depreciation rates for different classes of assets.

    Sl. No. Asset Class Asset Type Rate of Depreciation
    1 Building Residential buildings not including boarding houses and hotels 5%
    2 Building Boarding houses and hotels 10%
    3 Building Purely temporary constructions like wooden structures 100%
    4 Furniture Any fittings / furniture including electrical fittings 10%
    5 Plant and machinery Motor cars excluding those used in a business of running them on hire 15%
    6 Plant and machinery Lorries/taxis/motor buses used in a business of running them on hire 30%
    7 Plant and machinery Computers and computer software 60%
    8 Plant and machinery Books owned by assessee carrying on a profession being annual publications 100%
    9 Plant and machinery Books owned by assessee carrying on profession not being annual publications 60%
    10 Plant and machinery Books owned by assessee carrying on business in running lending libraries 100%
    11 Intangible assets Franchise, trademark, patents, license, copyright, know-how or other commercial or business rights of similar nature 25%

    Depreciation Rates as per the Income Tax Act:

    Part A – Tangible Assets:
    Building1Buildings used primarily for residential reasons (excluding boarding houses and hotels)5%
    2Buildings apart from those used primarily for residential reasons and not covered by sub-items 1 (above) and 3 (below)100.00%
    3Buildings procured on or after September 1, 2002, for installing plant and machinery forming part of water treatment system or water supply project and which is used for the purpose of business of providing infrastructure facilities under clause (i) of subsection (4) of section 80-IA100.00%
    4Purely temporary erections like wooden structures100.00%
    Furniture and fittings Furniture and fittings including electrical fittings10.00%
    Plant and machinery1Plant and machinery excluding those covered by sub-items (2), (3) and (8) below15.00%
    2Motor cars, excluding those used in a business of running them on hire, procured or put to use on or after April 1, 199015.00%
    3(i)Aeroplanes – Aero Engines40.00%
    3 (ii)Motor taxis, motor buses and motor lorries used in a business of running them on hire30.00%
    3 (iii)Commercial vehicle which is procured by the assessee on or after October 1, 1998, but before April 1, 1999, and is used for any period of time prior to April 1, 1999, for the purpose of profession or business in agreement with the third proviso to clause (ii) of sub-section (1) of section 3240.00%
    3 (iv)New commercial vehicle procured on or after October 1, 1998, but prior to April 1, 1999, in replacement of condemned vehicle of more than 15 years of age and is used for any period of time prior to April 1, 1999, for the purpose of profession or business in agreement with the third proviso to clause (ii) of sub-section (1) of section 3260.00%
    3 (v)New commercial vehicle procured on or after April 1, 1999, but before April 1, 2000, in replacement of condemned vehicle of more than 15 years of age and is put to use prior to April 1, 2000, for the purposes of profession or business in agreement with the second proviso to clause (ii) of sub-section (1) of section 3260.00%
    3 (vi)New commercial vehicle procured on or after April 1, 2001, but before April 1, 2002, and is put to use before April 1, 2002, for the purpose of profession or business50.00%
    3 (vii)Moulds used in plastic and rubber goods factories30.00%
    3 (viii)

    Air pollution control equipment

    • Felt
    • filter system
    • Electrostatic precipitation systems
    • Scrubber
    • counter current / packedbed / venture / cyclonic scrubbers
    • Dust collector systems
    • Evacuation system and ash handling system
    100.00%
    3 (ix)

    Water pollution control equipment

    • Aerated detritus chambers (including air compressor)
    • Mechanical screen systems
    • Mechanically skimmed grease and oil removal systems
    • Flash mixing equipment and chemical feed systems
    • Mechanical reactors and mechanical flocculators
    • Mechanically aerated activated sludge / diffused air systems
    • Biofilters
    • Aerated lagoon systems
    • Air floatation systems
    • Methane
    • recovery anaerobic digester systems
    • Steam/air stripping systems
    • Marine outfall systems
    • Urea Hydrolysis systems
    • Activated carbon column
    • Bio
    • disc or rotating biological contractor
    • Marine outfall systems
    • Ion exchange resin column
    • Centrifuge for dewatering sludge
    30.00%
    3 (x)

    (a) Solid waste, control equipment

    Cryolite / mineral / lime / caustic / chrome recovery system

    (b) Resource recovery and solid waste recycling systems

    100.00%
    3 (xi)Plant and machinery used in semi-conductor industry covering all integrated circuits (ICs) (not including hybrid integrated circuits) ranging from small scale integration (SSI) to large scale integration / very large scale integration (LSI/VLSI) as also discrete semiconductor devices like diodes, triacs, thyristors, transistors, etc., except those covered by entries (viii), (ix), (x) of this sub-item and sub-item (8) below30.00%
    3 (xi)aLife Saving medical equipment
    • D.C Defibrillators for pacemakers and internal use
    • Colour Doppler
    • Haemodialysis
    • Cobalt therapy unit
    • Vascular Angiography System including Digital subtraction Angiography
    • Heart lung machine
    • Spect Gamma Camera
    • Magnetic Resonance Imaging System
    • Ventilator used with anaesthesia apparatus
    • Ventilator except those used with anaesthesia
    • Surgical laser
    • Gamma knife
    • Fibreoptic endoscopes including audit resectoscope/paediatric resectoscope, arthoscope, peritoneoscopes, fibreoptic flexible nasal pharyngo, microaryngoscope, video laryngo, fiberoptic flexible laryngo bronchoscope.
    • Bronchoscope, video oescophago gastroscope, video oescopghago bronchoscope, fibreoptic flexible oesophago gastroscope
    40.00%
    4Containers made of plastic or glass used as refills50.00%
    5Computers including computer software60.00%
    6Plant and machinery, used in processing, weaving and garment sector of textile industry, which is bought under TUFS on or after April 1, 2001, but prior to April 1, 2004, and is put to use prior to April 1, 200450.00%
    7Plant and machinery procured and installed on or after September 1, 2002, in a water treatment system or a water supply project and put to use for the purpose of business of providing infrastructure facility under clause (i) of sub-section (4) of section 80-IA100.00%
    8

    1. Wooden parts used in artificial silk manufacturing machinery

    100.00%

    2. Match factories – wooden match frames

    3. Cinematograph films – bulbs of studio lights

    100.00%

    4. Salt works – condensers, reservoirs, salt pans, etc., made of clayey, sandy or earthy material or any other similar material

    100.00%

    5. Quarries and mines

    100.00%

    Sand stowing pipes, winding ropes, tubs and haulage ropes

    Safety lamps

    6. Flour mills – rollers

    7. Sugar works – rollers

    80.00%

    8. Steel and iron industry – rolling mill rolls

    80.00%

    9. Energy saving devices

    80.00%

    (A) Furnaces and specialised boilers

    (i) Fluidized bed boilers / ignifluid

    80.00%

    (ii) Continuous pusher type furnaces and flameless furnaces

    (iii) High efficiency boilers

    (iv) Fluidized bed type heat treatment

    (B) Instrumentation and monitoring system for monitoring energy flows

    80.00%

    (i) Digital heat loss meters

    (ii) Automatic electrical load monitoring systems

    (iii) Infrared thermography

    (iv) Microprocessor based control systems

    (v) Meters for measuring heat losses, steam flow, furnace oil flow, power factor and electric energy meters

    (vi) Exhaust gas analysers

    (vii) Maximum demand indicator and clamp on power meters

    (viii) Fuel oil pump test bench

    (C) Waste heat recovery equipment

    80.00%

    (i) Air pre-heaters and recuperators

    (ii) Feed water heaters and economisers

    (iii) Thermal energy wheel for low and high temperature heat recovery

    (iv) Heat pumps

    (D) Co-generation systems

    80.00%

    (i) Controlled extraction, back pressure pass out, extraction cum condensing turbines for cogeneration along with pressure boilers

    (ii) Organic rankine cycle power systems

    (iii) Vapour absorption refrigeration systems

    (iv) Low inlet pressure small steam turbines

    (E) Electrical equipment

    80.00%

    (i) Synchronous condenser systems and shunt capacitors

    (ii) Relays (automatic power cut off devices)

    (iii) Power factor controller for AC motors

    (iv) Automatic voltage controller

    (v) Solid state devices for controlling motor speeds

    (vi) FACT (Flexible AC Transmission) devices – Thyristor controlled series compensation equipment

    (vii) Thermally energy-efficient stenters

    (viii) Series compensation equipment

    (ix) TOD (Time of Day) energy meters

    (x) Intelligent electronic devices/remote terminal units, computer software/hardware, bridges/router, other required equipment and associated communication systems for data acquisition systems and supervisory control, distribution management systems and energy management systems for power transmission systems

    (xi) Special energy meters for ABT (Availability Based Tariff)

    (F) Burners

    80.00%

    (i) Zero to ten per cent excess air burners

    (ii) Burners using air with high preheat temperature (above 300 degrees Celsius)

    (iii) Emulsion burners

    (G) Other equipment

    80.00%

    (i) Mechanical vapour recompressors

    (ii) Wet air oxidation equipment for recovery of heat and chemicals

    (iii) Automatic microprocessor based load demand controllers

    (iv) Thin film evaporators

    (v) Fluid couplings and fluid drives

    (vi) Coal based producer gas plants

    (vii) Super-charges/turbo charges

    (viii) Sealed radiation sources for radiation processing plants

    10. Gas cylinders including regulators and valves

    60.00%

    11. Glass manufacturing concerns – Direct fire glass melting furnaces

    60.00%

    12. Mineral oil concerns

    60.00%

    (i) Plant used in field operations (above ground) distribution – returnable packages

    (ii) Plant used in field operations (below ground), but not including kerbside pumps including fittings and tanks used in field operations (distribution) by mineral oil concerns

    13. Renewable energy devices

    60.00%

    (i) Pipe type and concentrating solar collectors

    (ii) Flat plate solar collectors

    (iii) Solar cookers

    (iv) Air/fluid/gas heating systems

    (v) Solar water heaters and systems

    (vi) Solar crop drivers and systems

    (vii) Solar steels and desalination systems

    (viii) Solar refrigeration, air conditioning systems and cold storages

    (ix) Solar pumps based on solar-photovoltaic and solar-thermal conversion

    (x) Solar power generating systems

    (xi) Solar-photovoltaic panels and modules for water pumping and other applications

    14. Wind mills and any other specially designed devices that operate on wind mills (installed on or after April 1, 2014)

    80.00%

    15. Any special devices including electric pumps and generators operating on wind energy (installed on or after April 1, 2014)

    80.00%

    16. Books owned by assessees carrying on a profession

    (i) Books, being annual publications

    100.00%

    (ii) Books, excluding those covered by entry (i) above

    60.00%

    (iii) Books owned by assessees carrying on business in running lending libraries

    100.00%
    Ships4(i)Ocean-going ships including tugs, survey launches, dredgers, barges and other similar ships used primarily for dredging purposes and sighing vessels with wooden hull
    4 (ii)Vessels ordinarily operating on inland waters, not covered by sub-item (iii) below20.00%
    4 (iii)Vessels ordinarily operating on inland waters being speed boats20.00%
    Part B – Intangible Assets:

    Patents, know-how, trademarks, franchises, copyrights, licenses or any other commercial or business right of similar nature

    25%

    TAX
    Forms:

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