Department of fixed assets

If a person start business on Ist Jan. 2011. and balance sheet is prepared on 31st march 2011. then as per Income tax act dep. should be provided for 6 month or for 3 month ??

Replies (7)

Hi Hemant,

You can claim depreciation @ half rate for that year.

As per section 32 where an asset  is acquired by the assessee during the previous year and is put to use for the purposes of business or profession for a period of less than 180 days in that previous year, the deduction for depreciation in  respect of such asset shall be restricted to fifty per cent.

Under Income tax Act, we have to claim dep. either at100% or 50% of prescribed dep rate.

computation of Depreciation under section  32,

Asset purchased during the year and put to use for less than 180 days-if any particular asset is purchased during the year and it has been put to use for less than 180days during the year , in that case , depreciation is allowed at half the normal rate.

If it is purchased during the year and it not at all put to use , dep shall not allowed . but in subsequent year whenever the asset is put to use , full dep shall be allowed irrespective of period of use.

Agreed with Mr. Sanat

Originally posted by : Sanat kumar
Hi Hemant,
You can claim depreciation @ half rate for that year.
As per section 32 where an asset  is acquired by the assessee during the previous year and is put to use for the purposes of business or profession for a period of less than 180 days in that previous year, the deduction for depreciation in  respect of such asset shall be restricted to fifty per cent.
Under Income tax Act, we have to claim dep. either at100% or 50% of prescribed dep rate.

agreed with sanat

Yes.. less than 180 days...half the rate of depreciation

 

computation of Depreciation under section  32,

Asset purchased during the year and put to use for less than 180 days-if any particular asset is purchased during the year and it has been put to use for less than 180days during the year , in that case , depreciation is allowed at half the normal rate.

If it is purchased during the year and it not at all put to use , dep shall not allowed . but in subsequent year whenever the asset is put to use , full dep shall be allowed irrespective of period of use.

Thanks a lot frnds

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