LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Rate of Deprecaition on Motor Car

CA. Megha Topiwala (Job) (1534 Points)

26 September 2009

Wht is the rate of depreciation to b claimed for a motor car puchased on 1.2.2009 for the use of business ?

Reply
Follow
Share

3 Replies

Ratan Deep Saxena (Asstt Manager (Accounts & Finance)) (2998 Points)
Replied 26 September 2009

If an asset is used less than 180 days during the financial year in the business, depreciation can be claimed at half of the present rate. The rate of depreciation on motor car is 15%. In ur problem car is purchased on 01.02.09, means car is used in the business for 59 days only. hence depreciated shall be calculated @ 7.5% of the value of car.

regards,

ratan

HITESH (CA STUDENT) (50 Points)
Replied 26 September 2009

Hi Megha,

Have a nice day!

I got the your point.

Where an asset acquired during the year is put to use for the purpose of business or profession for a period of less than 180 days in a year, depreciation allowance shall be restricted to 50% of the amount calculated at prescribed rates.

01) Motor-cars (other than those used in business of running them on hire) acquired or put to use on or after 1st April, 1990 than Rate of Depreciation is 15% P.A.

02) Motor buses, Motor lorries and Motor taxies used in a business of running them on hire than Rate of Depreciation is 30% P.A.

Thanking You,

Hitesh - CA Student from Ahmedabad