Depreciation on transport vehicle

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 September 2013 Dear Sir,

One of our client is running the business of supplying the well water to his clients and for that he has his own trucks. My question is at what rate of depreciation he require to make at the end of the year.

Yours Faithfully

Querist : Anonymous

Querist : Anonymous (Querist)

19 September 2013 Please reply for my above query...

Thank You

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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21 July 2024 For the trucks used in the business of supplying well water, the applicable rate of depreciation would depend on whether the trucks are considered as "motor vehicles" under the Income Tax Act in India. Generally, trucks are classified as motor vehicles for depreciation purposes. Here are the depreciation rates applicable:

1. **Motor Vehicles (including trucks)**:
- For motor vehicles used for business purposes, the depreciation rate under the Income Tax Act is 30% per annum on the written down value (WDV) method. This is applicable for trucks used in the business of supplying well water.

It's important to note that depreciation is calculated on the cost of the asset (or its actual cost to the assessee if acquired before the previous year) less any residual value, using the WDV method. The residual value is typically assumed to be 5% of the actual cost.

Therefore, your client can claim depreciation at the rate of 30% per annum on the trucks used in his business of supplying well water, provided they are classified as motor vehicles under the Income Tax Act.

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