Depreciation, both Acts at once
Tax year 2026-27Two depreciation charges on one asset, and the difference between them
Schedule II gives a useful life; the Income-tax Act gives a rate on a block. Both charges on one asset, and the difference run forward year by year.
Your figures
- Schedule II, Part C
- Information technology equipment, end user devices such as desktops and laptops3 years[NESD]
- Appendix I, Income-tax Rules Not read from the official text
- Computers including computer software40%
Read from a Gazette formatted copy rather than the official text, and editable below for that reason. Section 06 sets out what was and was not verified.
Appendix I has one computer rate and does not distinguish an end user device from a server. Schedule II does, at 3 years against 6.
About this
The book pro rata runs from this date. AS 10 and Ind AS 16 begin depreciation when the asset is available for use, so where your policy takes that date, use it here.
About this
The 180 day test runs on days of USE from this date. It is a separate date from the one above and the two sides deliberately do not share it.
About this
Leave empty where the asset is still held. Schedule II Note 2 stops the book pro rata on this date.
What the dates decide
- Book pro rata, from the date of addition
- 121 of 365
- Days put to use, for s.33(4)
- 121
- Acquired in this year
- Yes
- What the block does with it
- Addition, half rate under s.33(4)
Both limbs of s.33(4) are met, so the rate on THIS ASSET is halved. It is halved on nothing else: not on the opening written down value of the block, and not on any other addition used for 180 days or more. The forgone half is not carried forward. The asset earns the full rate from next year.
Who the assessee is
About the regime
A concessional regime denies additional depreciation altogether and caps depreciation on every block at forty percent of written down value under rule 25(2). Set it to match the election actually made.
Timing difference for the year
Tax ahead₹ 1,29,502
The book charge against tax depreciation, for the year.
Tax depreciation is ₹ 1,29,502 higher than the book charge. Taxable profit sits below book profit by that amount this year and the relief is being taken earlier than the books take it, which unwinds in later years to the extent the two columns write off the same amount. Section 05 runs it forward and says whether it reverses inside the years shown. In deferred tax terms that direction is a liability. The tax side here is the charge on the WHOLE BLOCK, which carries ₹ 3,00,000 of written down value and other additions besides this asset, so the two are not like for like until the rest of your register is in the book column. The two rows below give this asset alone, which is the comparison to carry into a deferred tax working.
01 / The whole reason this page exists
One asset, two charges, one difference
Which way it runs
Tax depreciation is ₹ 1,29,502 higher than the book charge. Taxable profit sits below book profit by that amount this year and the relief is being taken earlier than the books take it, which unwinds in later years to the extent the two columns write off the same amount. Section 05 runs it forward and says whether it reverses inside the years shown. In deferred tax terms that direction is a liability.
Cumulatively, over the 10 years in the schedule below, the books charge ₹ 95,000 and the Act allows ₹ 99,194, a difference of ₹ 4,194. The cumulative difference crosses nil in 2028-29, which is where the reversal completes.
An asset against a block
The tax charge is the charge on the WHOLE BLOCK, which carries ₹ 3,00,000 of written down value and other additions besides this asset. That is (A less D) and the year's additions with this asset's own cost taken out of them, not the pool its cost went into. The book column is one asset. The two are not a like for like comparison until the rest of your fixed asset register is in the book column.
On this asset alone the two come to ₹ 10,498 in the books against ₹ 20,000 under the Act. That is the comparison the year by year schedule runs.
The two workings, line by line
The book charge and the tax charge for the year, each with its full working, so every line can be ticked against your own. The left column is an asset over a life under Schedule II. The right is a block at a rate under s.33. They are not the same thing and they are not meant to be; what a CA needs at year end is the gap between them.
Book charge for the year, Schedule II
₹ 10,498
Straight line over 3 years, on cost less a residual value of 5%.
Tax depreciation for the year, s.33
₹ 1,40,000
Block at 40%, with the half rate pool restricted by s.33(4).
02 / Schedule II to the Companies Act, 2013
A life, not a rate, and it is indicative rather than fixed
The book policy
Why
Schedule II mandates neither. The choice is the company's accounting policy, applied consistently and disclosed.
Why
Para 3(i) puts residual value at not more than five percent of original cost. It is a CEILING and it is rebuttable, not a requirement to use five. Note 5, which used to carry the five percent, was omitted with effect from 1 April 2014, so cite para 3(i) for it and not Note 5.
Why
In the year of purchase this IS cost, which is why it tracks the cost box until you set it. For an asset carried from an earlier year, enter the written down value it stood at on the first day of this year, the way A less D does on the tax side.
Shift working, Note 6
Not available on this class. End user devices, desktops and laptops carries [NESD] in Part C, which means no extra shift depreciation, and Note 6 does not reach an [NESD] asset at all. Of every class on this page only general plant and machinery is eligible. A shift toggle offered on a laptop is the kind of error a reviewer spots in ten seconds, so there is no control here rather than one that quietly does nothing.
Book charge for the year
3 year life₹ 10,498
Cost less residual value, spread evenly over the life, then taken pro rata for the days from the date of addition.
Why the life is a field, and how the pro rata runs
Schedule II prescribes useful lives and never rates, and it mandates neither the straight line nor the written down value method. Part A para 3(i), as amended in 2014, says the life shall not ordinarily be different from Part C. The words it replaced were shall not be longer than. That change is why the life is a field and not a constant: a longer or a shorter life is permitted on disclosing the difference with justification duly supported by technical advice.
Note 2 makes the book pro rata DATE based, from the date of addition or up to the date of disposal. It is not the 180 day rule, and the two sides of this page deliberately do not share the code that works it out. An asset added on 1 December gets 121 days in the books and a halved rate under the Act, and those two facts have nothing to do with each other.
03 / s.41(1)(c) and s.33 of the Income-tax Act, 2025
The block is a pool, and the half rate reaches one asset
The block this asset sits in
Why
(A less D) is the opening written down value. Enter last year's closing block and the depreciation that was allowed on it, not this year's opening figure, so the two lines reconcile to the return.
A year declared under the presumptive scheme still writes the block down, as if the depreciation had been claimed and allowed. The presumptive calculator sets that scheme against normal books.
Why
The asset you described above is added to the half rate pool automatically at ₹ 1,00,000, from its own dates. These two boxes are for everything ELSE that entered the block this year.
The rates pre-filled on this page were read from a Gazette formatted copy of the Income-tax Rules, 2026 and not from the official text. Every automated fetch of the official page made for this work came back 403, and a direct download in a browser was blocked as well. Confirm the rate against the official text before you rely on it. That is why this is a field and not a constant.
An assumption, not a rule
Why
Long standing practice, and the default here. The proceeds come off the pool carrying the full rate before they touch the half rate pool, which leaves the smaller deduction of the three readings.
Tax depreciation on the block
40%₹ 1,40,000
Each line is the one the section names, in the order it names them, so the working can be ticked against a computation.
How the block is worked, and why no year is skipped
Written down value of a block is [(A less D) plus B less C], in that order. A is the block in the immediately preceding year, D the depreciation actually allowed for that year, B the actual cost of additions, C the moneys payable plus scrap on what left. C shall not exceed (A less D) plus B, which is what stops a block going negative. The half rate in s.33(4) then attaches to the qualifying addition and to nothing else, which is the line this page exists to get right.
Depreciation is mandatory. s.33(7) allows it whether or not the assessee has claimed a deduction for it, so there is no option here to skip a year and there should not be one anywhere else either.
04 / s.33(8) and s.33(9)
Additional depreciation survived, and the default hides it
Who qualifies, and why the relief starts off
Twenty percent of actual cost, on new machinery or plant, for a manufacturer or a business of generating, transmitting or distributing power. Where the asset was put to use for less than a hundred and eighty days it is ten percent now and the other ten in the immediately succeeding tax year. It is not available on an asset used before by anyone, on anything installed in office premises or residential accommodation, on office appliances, on road transport vehicles, or on an asset whose whole cost is already allowed.
Here is the part that costs money. Additional depreciation is DENIED under every concessional regime, and s.202(1) is the default for an individual or a HUF under s.202(2)(a)(vi) and s.205(1)(a). A proprietor is on it unless they have indicated an opt out under s.202(4). A calculator that defaults the relief on for that assessee overstates the deduction for exactly the people it is meant to serve, which is why this page starts it off and makes you say otherwise.
Does the asset qualify
What this cannot check
This page asks whether the asset qualifies; it cannot check. The exclusions in s.33(8)(d) are questions about your client's asset, not about a figure, and a second hand machine or an office appliance is outside the relief however new it is to the business.
Additional depreciation allowed
not an eligible business₹ 0
Not available. s.33(8) reaches a manufacturer, or a business of generating, transmitting or distributing power, and nobody else. A trading or service business does not get it however new the plant is.
The year by year projection is shown in section 05.
05 / The difference, year by year
A timing difference is only a difference in timing
| Year | Book opening | Book charge | Book closing | Tax opening | Tax charge | Tax closing | Difference | Cumulative |
|---|---|---|---|---|---|---|---|---|
| 2026-27 | ₹ 1,00,000 | ₹ 10,498 | ₹ 89,502 | ₹ 0 | ₹ 20,000 | ₹ 80,000 | -₹ 9,502 | -₹ 9,502 |
| 2027-28 | ₹ 89,502 | ₹ 31,667 | ₹ 57,835 | ₹ 80,000 | ₹ 32,000 | ₹ 48,000 | -₹ 333 | -₹ 9,835 |
| 2028-29reverses | ₹ 57,835 | ₹ 31,667 | ₹ 26,168 | ₹ 48,000 | ₹ 19,200 | ₹ 28,800 | +₹ 12,467 | +₹ 2,632 |
| 2029-30book spent | ₹ 26,168 | ₹ 21,168 | ₹ 5,000 | ₹ 28,800 | ₹ 11,520 | ₹ 17,280 | +₹ 9,648 | +₹ 12,280 |
| 2030-31 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 17,280 | ₹ 6,912 | ₹ 10,368 | -₹ 6,912 | +₹ 5,368 |
| 2031-32 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 10,368 | ₹ 4,147 | ₹ 6,221 | -₹ 4,147 | +₹ 1,221 |
| 2032-33 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 6,221 | ₹ 2,488 | ₹ 3,733 | -₹ 2,488 | -₹ 1,267 |
| 2033-34 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 3,733 | ₹ 1,493 | ₹ 2,240 | -₹ 1,493 | -₹ 2,760 |
| 2034-35 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 2,240 | ₹ 896 | ₹ 1,344 | -₹ 896 | -₹ 3,656 |
| 2035-36 | ₹ 5,000 | ₹ 0 | ₹ 5,000 | ₹ 1,344 | ₹ 538 | ₹ 806 | -₹ 538 | -₹ 4,194 |
| Charged over the schedule | ₹ 95,000 | ₹ 99,194 | -₹ 4,194 | |||||
The cumulative difference crosses nil in 2028-29, which is where the reversal completes.
How to read the table, and what it assumes
Whichever side runs ahead this year, the other catches up. The table runs the same asset forward on both bases so you can follow the annual difference and see how far the cumulative column walks back inside the years shown. Both columns here are the ASSET ALONE, because a block is a pool and an asset is an asset, and that is the only way the two can be set beside each other honestly.
A positive difference means the books charged more than the Act allowed that year; a negative one means the Act ran ahead. The reversal is the CUMULATIVE column walking back through nil, which is not the same event as the annual sign changing. The annual sign changes for one of two reasons: the book column has reached its residual value and stopped, so the tax column runs on by itself, or the tax charge has fallen below a book charge that is still running, which is the difference beginning to unwind. Book spent marks the row the book column charges for the last time. Reverses marks the row the cumulative column crosses nil, and whether those are two rows or one is something to read off the table rather than assume.
What this table assumes, plainly.
- Both columns run this asset as if it were its own block. The tax side is legally a block and not an asset, so the projection is exact only where this asset really is the whole block.
- The book column reaches its residual value of ₹ 5,000 in 2029-30, which is the year it charges for the last time. The rows after that are the tax written down value running on by itself, which is where the rest of the difference sits, so a turn marked after 2029-30 is the book column running out and not the reversal arriving.
- Every year after the first is a whole year at the full rate, and the asset is assumed held throughout every year the table runs. Nothing here knows of a disposal after this one, so read the table only as far as the year the asset goes.
- Where a shift was set above it is carried across the whole of every later year, because a plant that runs a second shift runs it every year.
- Additional depreciation here is this asset's own and not the block's. s.33(8) runs on the actual cost of the qualifying plant, so the table takes so much of the qualifying cost as this asset accounts for and none of the ten percent carried in from last year.
- The schedule stops at 10 years with ₹ 806 still standing in the tax block, because a written down value never quite reaches nil.
06 / Where each half of this page comes from
Two sources of law, checked two different ways
This page applies two statutes, and they were not verified to the same standard. One of them has a gap in its provenance that you should know about before you rely on a figure, so it is set out here rather than left in a footnote.
The book side
Amended text appliedSchedule II to the Companies Act, 2013, as amended by G.S.R. 237(E) dated 31 March 2014 and G.S.R. 627(E) dated 29 August 2014
Checked on 17 September 2026
3 notes on this source
- The Schedule II text applied here is the AMENDED text, taken from ICAI Guidance Note GN(A) 35 on Accounting for Depreciation in Companies in the context of Schedule II, February 2016, which reproduces the amended Schedule and both gazette notifications in full.
- The MCA searchable text of Schedule II still shows the as enacted 2013 figures and is stale on five points, continuous process plant among them: it reads 8 years where the amended figure is 25. A reader checking this page against that text will disagree with it, and the amended text is the one in force.
- Schedule II prescribes useful lives and never rates, and it mandates neither the straight line nor the written down value method. The choice of method is the company's accounting policy.
No link given. The copy that governs is the one the Institute currently publishes, and the obvious alternative link serves a stale text.
The tax side
Rate table not from the official textTax year 2026-27, s.33 of the Income-tax Act, 2025, with rule 25 and Appendix I of the Income-tax Rules, 2026
Checked on 17 September 2026
2 notes on this source
- The rule is 25 and the table is Appendix I. Commentary widely cites rule 5 and an Appendix IA, and there is no Appendix IA.
- The Act text, s.33, s.41 and s.74 among them, was read from the ICAI Bare Law edition linked below. The rate table was not, and the note on that is in the caveats on this page.
The gap: the Appendix I rates were not read from the official text
The short of it. The Schedule II figures are the AMENDED ones and they differ from the text MCA still serves on its own searchable pages, which is stale on five points: a reader checking there will find continuous process plant at 8 years where the amended figure is 25. The Appendix I rates were read from a Gazette formatted copy carrying G.S.R. 198(E), the date of 20 March 2026, the enabling section 533 and the Gazette running page numbers. Every automated fetch of the official page made for this work came back 403, and a direct download in a browser was blocked as well, so the official text itself was not read. Both of those are reasons to treat the pre-filled figures as a starting point you confirm, which is exactly why both are editable fields.
07 / One asset at a time
The hard part is the register
One asset is arithmetic. A client with four hundred of them, half bought mid year, is the actual work. OptiFinancials builds the financial statements from the client's own Tally ledgers.
Nothing leaves this page
Every figure is computed in your own browser as you type. Nothing is sent, stored or logged, and there is no account. Close the tab and the working is gone.
Assumptions and basis
What this calculator applied
- Law applied
- Tax year 2026-27, Schedule II to the Companies Act, 2013, with s.33 of the Income-tax Act, 2025 and rule 25 and Appendix I of the Income-tax Rules, 2026
- Rates checked
- Checked on 17 September 2026
24 notes on how the law was applied
- The Income-tax Act, 2025 is in force from 1 April 2026, so it governs tax year 2026-27, and the Income-tax Rules, 2026 carry the rate table. The Act replaces the previous year and the assessment year with a single tax year, which is why no assessment year is named above.
- THE RATE TABLE. The Appendix I rates pre-filled here were read from a Gazette formatted copy of the Income-tax Rules, 2026 carrying G.S.R. 198(E), the date of 20 March 2026, the enabling section 533 and the Gazette running page numbers, and NOT from the official text. Every automated fetch made for this work came back 403 from incometaxindia.gov.in, and a direct download in a browser was blocked as well. Confirm the rate against the official text before you rely on it. That is why the block rate on this page is an editable field and not a constant.
- The rule is 25 and the table is Appendix I. A good deal of commentary cites rule 5 and an Appendix IA. There is no Appendix IA, and the rule is not 5.
- Schedule II useful lives are INDICATIVE, not a ceiling. Part A para 3(i), as amended by G.S.R. 627(E) dated 29 August 2014, says the life shall not ordinarily be different from Part C. The as enacted wording, shall not be longer than, was deliberately removed. A longer or a shorter life may be taken on disclosing the difference with justification duly supported by technical advice, which is why the life here is editable.
- The five percent residual value is a CEILING and it is rebuttable. Part A para 3(i) says residual value shall not be more than five per cent of the original cost, subject to the same proviso as the life. Note 5, which is what most writing cites for the five percent, was omitted by G.S.R. 237(E) with effect from 1 April 2014, so citing it cites a repealed note.
- The written down value rate formula, R = [1 - (s/c) raised to the power 1/n] x 100, is ICAI's, from Guidance Note GN(A) 35 para 38. It is NOT in Schedule II. A reader who searches the Schedule for it will not find it. Where residual value is nil the formula solves to a hundred percent, which is a limitation of the method and not an answer, and this page says so rather than writing the asset off in year one.
- THE ALLOCATION OF SALE PROCEEDS IS NOT PRESCRIBED. Where a block has a disposal and both full rate and half rate additions in the same year, neither s.41 nor rule 25 says how the moneys payable are taken off the two pools. s.41 reduces the block as a whole, and the pools exist only to apply s.33(4). Long standing practice reduces the full rate pool first and that is the default here; it is offered as a choice so you can see the spread. It is practice, not law.
- The book charge and the tax charge are not measured on the same thing. Schedule II depreciates an ASSET over a life; s.33 depreciates a BLOCK at a rate. The year by year schedule on this page runs the asset as if it were its own block on both sides, which is the only like for like comparison there is, and it is exact only where the asset really is the whole block.
- The book pro rata runs from the DATE OF ADDITION under Schedule II Note 2, and the tax restriction runs on days PUT TO USE under s.33(4). Where those two dates differ the two sides part company. AS 10 and Ind AS 16 start depreciation when an asset is available for use, so where your accounting policy takes that date rather than the date of addition, use it in the book date field.
- s.33(4) restricts the deduction to fifty percent of the prescribed rate on an asset acquired in the year AND put to use for less than a hundred and eighty days. Both limbs, together. The restriction attaches to THAT ASSET. It never touches the opening written down value of the block and never touches another addition used for a hundred and eighty days or more. The forgone half is not carried forward: the asset simply earns the full rate from the next year.
- s.41(1)(c) caps C, the moneys payable plus scrap, at (A - D) + B, so a block cannot go negative. Anything above that is a short term capital gain under s.74(2), which was s.50. Where every asset in a block is transferred the block ceases to exist, no depreciation is allowed on it for that year, and s.74(3) applies, which can produce a short term capital LOSS.
- Additional depreciation under s.33(8) and s.33(9) is denied under every concessional regime, s.202(1) among them, and s.202(1) is the DEFAULT for an individual or a HUF under s.202(2)(a)(vi) and s.205(1)(a). It is therefore switched off for a proprietor here unless you indicate an opt out under s.202(4). Getting this the wrong way round overstates the deduction for exactly the assessees this page is for.
- Additional depreciation reaches only a manufacturer, or generation, transmission or distribution of power, and it excludes an asset used before by anyone, an asset installed in office premises or residential accommodation, an office appliance, a road transport vehicle, and an asset whose whole cost is already allowed. This page asks you whether the asset qualifies; it cannot check.
- Where a concessional regime denies additional depreciation, the second ten percent carried in from an earlier year is refused here too. That is the conservative reading and it cannot overstate a deduction; check the transitional position for your client.
- Rule 25(2) caps the depreciation ALLOWED on any block at forty percent of written down value where a concessional regime applies. It caps the charge and not the rate, and the two are not the same thing: ten lakh of half rate additions at a prescribed sixty percent charge 3,00,000, which is thirty percent of written down value and inside the ceiling, while capping the rate to forty would cut it to 2,00,000 for no reason the rule gives. This page caps the charge. It is coded even though no rate in the table above reaches forty, because a legacy block can.
- Additional depreciation is refused here on a motor vehicle and on office equipment, because s.33(8)(d) excludes a road transport vehicle and an office appliance outright. The other exclusions in that clause, a machine used before by anybody and a machine installed in office premises or residential accommodation, are questions about your client's asset that this page cannot answer and does not try to.
- The 180 day count under s.33(4) stops at the date of disposal where one is entered, so an asset bought in June and sold in October counts as used for under 180 days and takes the half rate. That is a reading of the words put to use for less than one hundred and eighty days in that tax year, and the date of disposal is otherwise a Schedule II Note 2 concept. Leave the disposal date empty to count to the end of the year instead.
- The year by year table stops in the year the asset goes, and where no disposal date is entered it assumes the asset is held throughout and charges whole years at the full rate for as long as it runs. Where the block has ceased to exist it stops at one row, because s.74(3) allows no depreciation on it.
- Depreciation is mandatory. s.33(7) allows it whether or not the assessee has claimed a deduction for it, so there is no option here to skip a year and there should not be one.
- Goodwill is not depreciable. s.33(1)(b) takes it out of the intangible block, so the difference between a book amortisation of goodwill and a nil tax charge is PERMANENT and never reverses.
- Shift working under Note 6 increases the charge by fifty percent for a double shift and a hundred for a triple, for the portion of the year the shift was worked, and it reaches NO [NESD] asset. Of the classes on this page only general plant and machinery is eligible, which is why the control is disabled everywhere else.
- What this page strikes is the difference between two depreciation charges. A deferred tax balance is that difference at the rate expected to apply when it reverses, taken across every temporary difference and not depreciation alone, under AS 22 or Ind AS 12. This page does not compute deferred tax and does not know your other differences.
- WHERE THE ASSET WAS ALREADY IN THE BLOCK, the asset only column and the year by year table need a written down value for ONE ASSET, and s.33 produces one only for a block. The figure used is then your own apportionment and not a statutory amount: two CAs with the same block and the same asset can carry different figures for it and both blocks will still agree. Where the asset instead enters the block in this year no apportionment arises, because the asset column opens at nil and adds the actual cost, which is B under s.41(1)(c).
- Nothing here is a fixed asset register, a computation or advice. It is a working you can tick against your own.
This is a working estimate, not advice, and it will not cover every case. Rates and thresholds change. Check the figure against the law as it stands before you rely on it or sign anything. All calculators