Please advise, following assets shall be categorized under "Plant & Machinery" or "Office Equipment" for the purpose of calculating dep as per new Schedule II
1. Air conditioners for office 2. Inverter for office 3. Mobiles Phones
21 July 2024
As per Schedule II of the Companies Act, 2013, which provides for the useful lives and residual values of various assets, the categorization of assets for depreciation purposes is outlined based on their nature and use. Here's how the assets you mentioned typically fall under Schedule II:
1. **Air conditioners for office**: Air conditioners used in office premises are generally classified under "Plant & Machinery." According to Schedule II, items classified under Plant & Machinery have a useful life assigned based on their nature and typically fall under a 15-year depreciation schedule.
2. **Inverter for office**: Inverters used in an office for backup power supply are also categorized under "Plant & Machinery." The useful life would be determined based on the specific nature and intended use of the inverter, but it would generally fall under the 15-year depreciation schedule for Plant & Machinery.
3. **Mobile Phones**: Mobile phones used by employees for official purposes are typically classified under "Office Equipment" rather than "Plant & Machinery." According to Schedule II, Office Equipment has a useful life assigned based on their nature and use, typically falling under a shorter depreciation schedule compared to Plant & Machinery.
### Depreciation Rates According to Schedule II:
- **Plant & Machinery**: Typically depreciated over a useful life of 15 years. - **Office Equipment**: Depreciation rates vary depending on the specific asset. For example, computers and other electronic devices used as Office Equipment may have a useful life of 3 to 5 years.
### Conclusion: - **Air conditioners for office** and **Inverter for office** should be categorized under "Plant & Machinery" for depreciation purposes, with a useful life determined based on their specific nature. - **Mobile Phones** used for official purposes are typically categorized under "Office Equipment" and would have a depreciation schedule assigned accordingly.
It's advisable to consult with a qualified accountant or tax advisor who can provide specific guidance tailored to your company's circumstances and ensure compliance with the Companies Act, 2013 and related regulations.
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