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Depreciation (Section 32)

Depreciation on a block of assets for the year — including additional depreciation on new plant & machinery — and the closing written-down value.

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For guidance only — not tax advice. Every figure is drawn from BharatX’s verified rule book, with the sections and rules shown alongside it.

Depreciation: how it works and FAQs

FY 2025-26 (Income-tax Act 1961) and FY 2026-27 (Income-tax Act 2025) · Updated

How it works

Depreciation under section 32 is worked out on a "block of assets" — a group of assets with the same rate.

Depreciation under section 32 is worked out on a "block of assets" — a group of assets with the same rate. You take the opening written-down value, add purchases and subtract sale proceeds, then apply the rate. Assets used for 180 days or more get the full rate; assets used for less than 180 days get half. New plant & machinery can also get additional depreciation.

  1. Depreciation at full rate = (opening WDV + additions used ≥180 days − their sale proceeds) × rate.
  2. Depreciation at half rate = (additions used <180 days − their sale proceeds) × half the rate.
  3. Additional depreciation (new plant & machinery) = the eligible amount × the additional rate (half if used <180 days).
  4. Closing WDV = opening WDV + all additions − all sale proceeds − total depreciation.

Worked example

Total depreciation ₹1,50,000; closing WDV ₹8,50,000.

Plant & machinery block, opening WDV ₹10,00,000, no purchases or sales, rate 15%.

  1. Depreciation = 15% × 10,00,000 = ₹1,50,000.

Total depreciation ₹1,50,000; closing WDV ₹8,50,000.

Frequently asked questions

What is the half-rate rule?

An asset put to use for less than 180 days in the year gets only half the normal depreciation rate that year.

What is additional depreciation?

An extra 20% (or 35% in notified backward areas) on new plant & machinery, over and above the normal depreciation — not available on other assets.

Every figure the calculator shows lists the sections it relies on under “Legal basis”. For guidance only — not tax advice.