Beruflich Dokumente
Kultur Dokumente
Capital Asset
Depreciation is cost of the asset
over its useful time
Capital Asset
Example
All computers, laptops, printers
and software under the block of computers.
Rate: 60%
Example
All items of furniture under the head of
furniture.
Rate: 10%
It allows depreciation
for the block as a whole
by the Written Down Method.
It should be taken to
the head of capital gains.
Calculation of Depreciation
Opening WDV
Amount
+Addition 1
Amount
+Addition 2
Amount
-Deduction
Amount
WDV before
depreciation
Amount
Amount
+tive
Amount
Amount
-tive
TOTAL
Depreciate at
full Rate
Depreciate
at Half Rate
Total
Depreci
ation
Block of Asset
Plant & Machinery
Plant & Machinery
Building
Rate
10%
15%
15%
Furniture
10%
60%
Purchased IPR
Intangible Assets
25%
Factory building
Building
10%
Factory Land
Wind Mills
80%
WDV WDV on
on
March 31
1 April before dep
Dep @
15%
WDV on
March 31
after dep
2011-12 0
15% *
No asset after Oct 1 60 = 9
51
2012-13 51
119
2013-14 119
0 + 60 = 60
119
17.85
101.15
WDV WDV on
on
March 31
1 April before dep
2011-12 0
0 + 60 = 60
Dep @
15%
WDV on
March 31
after dep
51
15
85
12.75
72.25
2012-13 51
51 + 89 40
= 100
No asset after Oct 1
2013-14 85
85
PY
WDV WDV on
on
March 31
1 April before dep
2011-12 0
0 + 60 = 60
Dep @
15%
9
WDV on
March 31
after dep
51
No asset after
Oct 1
Key points
Addition 20% depreciation
New machinery
Only for the first year
Assessee engaged in manufacture/
production of any article or thing.
Ships or aircrafts
Used plant or machinery
Plant or machinery used in office or residential
accommodation
Office appliances or road transport vehicles
Whole of the cost is allowed as a deduction in
any previous year
Yes
No
Yes
No
No
No
No
No
No
Yes
No
WDV WDV on
Dep @
WDV on
on
March 31
March 31
after dep
1 April before dep
200x15% + 235
2012-13
200+100
200
(20%+15%)
=
100= 30+35
300
= 65
2013-14 235
235
235x 15%
199.75
= 35.25
WDV WDV on
Dep @
on
March 31
1 April before dep
400x15% +
2012-13
400+200
400
(1/2)(20%+
=
15%)200=
600
60+35 = 95
2013-14 505
505
505x 15%
=75.75
WDV on
March 31
after dep
505
429.25
WDV WDV on
on
March 31
1 April before dep
2013-14 4
4+1=5
Dep @
60%
WDV on
March 31
after dep
PY
2013-14
WDV WDV on
on
March 31
1 April before dep
1
Dep @
10%
WDV on
March 31
after dep
0.1
0.9
ON
100% or 1 time
of the Exp.
Will be allowed
(Except cost of
Land acquired)
Yes
Article or
thing
specified in
the list of the No
Eleventh
Schedule?
200% or 2 times of
the Exp. Will be
allowed .
(Except cost of:-Land acquired 0%
-Building Acq.
100% or 1 time)
Weighted deduction
175% or 1.75 times
of actual expenditure
125% or 1.25 times
of actual expenditure
125% or 1.25 times
of actual expenditure
Social Science
or Statistical
Research
Scientific
Research
To
Approved
Institution
To a
Company
175% or
1.75 times
of Exp.
125% or
1.25 times
of Exp.
To National
Laboratory or
IIT or University
(for Approved
programme )
200% or
2 times of
Exp.
125% or
1.25 times
of Exp.
Sec.35-Scientific Research
Innovision Ltd. is a company engaged in
manufacturing of computer chips. It incurs following
expenditure in lakhs towards research during the
P.Y. 2013-14. Calculate the allowed deductions:
Nature of Expenditure
Exp. weight deduction
Purchase of Research
100
2
200
equipment
2
40
Salary to Research scientists 20
Purchase of Land for
150
0
0
research center
Research center building
60
1
60
construction
continued
Innovision Ltd. is a company engaged in
manufacturing of computer chips. It incurs following
expenditure in lakhs towards research during the
P.Y.2013-14. Calculate the allowed deductions:
Nature of Expenditure
Exp. weight deduction
Admin. exp. for research
20
2
40
center
Consultancy fees to outside
5
2
10
scientists
Trial run expense at research 12
2
24
center
Sec.35-Scientific Research
Blue Ocean Ltd. is a company engaged in
manufacturing of cosmetics. It incurs following
expenditure in lakhs towards research during the
P.Y.2013-14. Calculate the allowed deductions:
Nature of Expenditure
Exp. weight deduction
Purchase of Research
100 1
100
equipment
1
20
Salary to Research scientists 20
Purchase of Land for
150 0
0
research center
Research center building
60
1
60
construction
continued
Nature of Expenditure
Exp. weight deduction
Admin. exp. for research
20
1
20
center
Consultancy fees to outside
5
1
5
scientists
Trial run expense at research 12
1
12
center
Amortisation
One:
Only certain listed kinds of expenditure
are eligible for amortisation.
These are:
Company formation
Feasibility Reports
Public subscriptions
Two:
Only up to 5% of the size of business
can be amortised.
Three:
Spread over five years
in equal measure from the year of
start of business.
Continued
Nature of Exp.
10
90
Yes
10
Yes
90
40
Yes
40
20
Yes
20
10
No
Total 170
160
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