Depreciation rate for fitness equipment

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Query asks about depreciation treatment for fitness equipment, especially items costing below Rs. 5000 like dumbbells, and applicable depreciation rates for various gym equipment. Response explains full expensing for assets below Rs. 5000 and 15-25% typical WDV depreciation for larger equipment.

gayathri

gayathri (Querist)
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31 July 2017 Hi All

I just want to understand how will you depreciate the fitness equipment costing less than Rs.5000 like dumbells etc, and whats the depreciation rate for different equipments. Can somebody guide me.

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N.Gayathri

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
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21 July 2024 Depreciation rates for fitness equipment can vary based on the nature of the equipment and the company's depreciation policy. Here's a general guideline on how depreciation might be handled for fitness equipment:

1. **Fitness Equipment Costing Less Than Rs. 5000:**
- As per the Companies Act, 2013, assets with an individual cost of less than Rs. 5000 can be fully depreciated in the year of acquisition. This means that if fitness equipment items like dumbbells or small accessories cost less than Rs. 5000 each, the entire cost can be expensed as depreciation in the year they are acquired.
- For example, if a set of dumbbells costs Rs. 3000, you can claim depreciation of Rs. 3000 in the year of purchase.

2. **Fitness Equipment Costing More Than Rs. 5000:**
- Fitness equipment items that cost more than Rs. 5000 each are subject to regular depreciation rules under the Companies Act, 2013.
- Typically, fitness equipment such as treadmills, ellipticals, weight machines, etc., fall into this category.
- The depreciation rate for such equipment would depend on the useful life estimated by the company's management and the depreciation method chosen (Straight Line Method or Written Down Value Method).

3. **Depreciation Rates for Various Fitness Equipment:**
- The specific rates may vary based on the company's depreciation policy and the useful life estimated for each type of fitness equipment.
- As a general guideline, common depreciation rates for fitness equipment under the Written Down Value (WDV) method might range from 15% to 25% per annum.
- If using the Straight Line Method (SLM), rates might be calculated based on a useful life determined by management, typically between 5 to 10 years depending on the equipment.

4. **Treatment of Small Fitness Accessories:**
- Small fitness accessories such as resistance bands, yoga mats, etc., which are used in conjunction with larger equipment, might also be expensed in the year of purchase if their cost individually is less than Rs. 5000.

It's important for companies to maintain consistency in their depreciation policies and ensure compliance with the Companies Act, 2013 while depreciating assets. Specific rates and methods can vary based on individual circumstances and accounting practices adopted by the company.

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