Amendment in Depreciation Rate as per Income Tax

Retrospective increase in depreciation rates on select plant & machinery: CBDT

Amendment:

  • CBDT has, vide the Income Tax (9th Amendment) Rules, 2019, notification dated 20th September 2019, announced increase in depreciation rate relating to Machinery and Plant for assets acquired on or after 23rd August 2019 but before 1st April 2020.
  • The amendment include increase in depreciation rate from 15% to 30% for motor cars other than those used in a business of running them on hire, acquired and put to use on certain period and increased depreciation from 30% to 45% for motor buses, motor lorries and motor taxis used in a business of running them on hire, acquired and put to use as per the aforementioned dates.
  • The amended rules shall be deemed to be effective from 23 August 2019.

Extract of the notification is as follows –

Block of Assets

Depreciation allowed as per percentage of written down value

“(2) (i) Motor cars, other than those used in a business of running them on hire, acquired or put to use on or after the 1st day of April, 1990 except those covered under entry (ii);

(ii) Motor cars, other than those used in a business of running them on hire, acquired on or after the 23rd day of August, 2019 but before the 1st day of April, 2020 and is put to use before the 1st day of April, 2020.

15

 

 

30”;

“(ii) (a) Motor buses, motor lorries and motor taxis used in a business of running them on hire other than those covered under entry (b).

(b) Motor buses, motor lorries and motor taxis used in a

business of running them on hire, acquired on or after the 23rd day of August, 2019 but before the 1st day of April, 2020 and is put to use before the 1st day of April, 2020.

30

 

 

45”.

 

[Notification No.  69 /2019/ F.No. 370142/17/2019-TPL]