Calculate asset depreciation using WDV (Written Down Value) or SLM (Straight Line Method) as per Income Tax Act and Companies Act 2013. Includes year-wise schedule.
Common Depreciation Rates — Income Tax Act
Asset Category
WDV Rate (IT Act)
Buildings (Residential)
5%
Buildings (Non-Residential)
10%
Plant & Machinery (General)
15%
Computers & Software
40%
Motor Cars (not taxis)
15%
Motor Cars (taxis / hire)
30%
Furniture & Fittings
10%
Solar Power Equipment
40%
Air Pollution Control Equipment
40%
Ships
20%
Intangibles (patents, know-how)
25%
WDV vs SLM — Key Difference
WDV (Written Down Value): Depreciation is applied to the reducing book value each year. Higher deduction in early years, lower later. Mandated by Income Tax Act for tax purposes. Good for assets that lose value quickly (computers, vehicles).
SLM (Straight Line Method): Equal depreciation each year over the asset's useful life. Simpler. Used for book purposes under Companies Act 2013. Rate = (Cost − Residual Value) ÷ Useful Life.
Half-Year Convention
If an asset is purchased in the second half of the financial year (October 1 – March 31), only 50% of the annual depreciation is allowed in Year 1 under the Income Tax Act.
Frequently Asked Questions
Under Income Tax Act, computers and computer software attract 40% WDV depreciation. Under Companies Act 2013, useful life of computers is 3 years (SLM rate ~33.33%). Solar equipment also qualifies for 40% accelerated depreciation under IT Act — a key commercial solar benefit.
WDV applies the rate on reducing book value — depreciation is higher in early years and decreases over time. SLM spreads depreciation equally each year (same amount annually). WDV is used for Income Tax; SLM is common for financial reporting under Companies Act.
Income Tax Act mandates the WDV (Written Down Value) method. All block of assets are pooled (e.g., all 15% machinery together) and the rate is applied on the opening WDV of the block after adding additions and deducting disposals.
Yes. Under Income Tax Act, full depreciation is allowed if the asset is used for more than 180 days in the year of purchase. If used for 180 days or less (second half of FY), only 50% depreciation is allowed in Year 1.