Depreciation
This query is : Resolved
16 January 2021
What is depreciation rate as per co act for Plant & Machinery and for equipment used in machinery?
06 July 2024
As per the Companies Act, 2013, the depreciation rates for Plant & Machinery and for equipment used in machinery are prescribed under Schedule II. Here are the depreciation rates applicable:
1. **Plant & Machinery**: The depreciation rate for Plant & Machinery is typically 15% per annum on a straight-line basis. However, there are specific categories of Plant & Machinery that have different rates prescribed under Schedule II. For example:
- For assets like molds and dies used in rubber and plastic goods factories, the rate is 30%.
- For assets like pollution control equipment, the rate is 100% if it is used exclusively for business purposes.
2. **Equipment used in machinery**: Equipment used in machinery is generally considered part of the Plant & Machinery category. Therefore, it would fall under the applicable depreciation rate for Plant & Machinery, which is 15% per annum, unless there are specific provisions or higher rates mentioned for certain types of equipment.
It's important to refer to Schedule II of the Companies Act, 2013, and any relevant amendments or notifications issued by the Ministry of Corporate Affairs (MCA) for precise and updated depreciation rates applicable to different categories of assets. Companies are required to apply these rates consistently and in accordance with the accounting standards prescribed under the Act.
1. **Plant & Machinery**: The depreciation rate for Plant & Machinery is typically 15% per annum on a straight-line basis. However, there are specific categories of Plant & Machinery that have different rates prescribed under Schedule II. For example:
- For assets like molds and dies used in rubber and plastic goods factories, the rate is 30%.
- For assets like pollution control equipment, the rate is 100% if it is used exclusively for business purposes.
2. **Equipment used in machinery**: Equipment used in machinery is generally considered part of the Plant & Machinery category. Therefore, it would fall under the applicable depreciation rate for Plant & Machinery, which is 15% per annum, unless there are specific provisions or higher rates mentioned for certain types of equipment.
It's important to refer to Schedule II of the Companies Act, 2013, and any relevant amendments or notifications issued by the Ministry of Corporate Affairs (MCA) for precise and updated depreciation rates applicable to different categories of assets. Companies are required to apply these rates consistently and in accordance with the accounting standards prescribed under the Act.
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