Motor Vehicle Depreciation Rate 2020

Under the income tax act depreciation is allowed only on written down value basis for motor vehicles.

Motor vehicle depreciation rate 2020.

Bus vehicle body assembly assets on supplied motor and chassis see table a motor vehicle. Depreciation rates for fy 2020 21 it is compulsory to calculate depreciation of assets that are used or acquired in a profession or business. Motor vehicles nesd 1. There is no existing rate of depreciation of 45 percent hence any motor vehicle purchased eligible for a 45 percent rate of depreciation shall form a new block of assets in machinery and plant.

Buildings include roads bridges culverts wells and tubewells. Higher rate have been prescribed only for motor cars motor buses motor lorries and motor taxis. A building shall be deemed to be a building used mainly for residential purposes if the built up floor area thereof used for residential purposes is not less than sixty six and two third per cent of its total built up floor area and shall include any such building in the factory. Motor vehicle body and trailer manufacturing 23120.

The central board of direct taxes cbdt has notified new depreciation rates of 30 and 45 on vehicles purchased between 23 08 2019 to 31 03 2020. This is according to the income tax act 1962 which gives the different rates of depreciation for different classes of assets. In the case of motor buses motor lorries and motor taxis used in a business of running them on hire the rate of depreciation increased from 30 percent to 45 percent. Motor cycles scooters and other mopeds.

The rates of 15 is applicable on 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. For the 2020 21 year the cost limit is 59 136. 2019 but before the 1st day of april 2020 and is put to use before the 1st day of april 2020. Rates of depreciation for income tax as applicable from the assessment year 2003 04 onwards.

Motor car motor cycle bike scooter 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. 10 00 000 so depreciation for fy 2019 20 10 00 000 x 15 1 50 000 value of the motor car on 31 3 2020 10 00 000 1 50 000 8 50 000. Example a motor car was bought on 1 4 2019 for rs. Notes on depreciation rates on assets.