Doubt : depreciation

This query is : Resolved

Devendra (Querist)
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19 August 2011 Is it that the WDV as per Company law is always greater than WDV as per Income Tax Act or it may be the other way round too?

Regards,
Devendra

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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19 August 2011 Not necessary.

Depreciation rates under Companies act is minimum rates prescribed

Depreciation under Income tax is maximum rates allowable

Naturally if we follow the rates prescribed by the act WDV under companies act always greater then WDV under Income tax.

But incase if you providing depreciation under companies act more then the Income tax act (since maximum rates not given in companies act)so that time it will be more then the WDV under Income tax

Also where the assets below Rs.5000 it can be taken 100% depreciation under companies act, but Income tax no such provision such cases WDV under Income tax is higher

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