Tax depreciation is calculated on a block of assets sharing class and rate, not separately on each asset.
Tax depreciation is calculated on a block of assets sharing class and rate, not separately on each asset. Opening WDV plus eligible additions minus sale proceeds forms the block base, subject to use and half-year rules.
Section 33 of the 2025 Act covers tangible and specified intangible assets but excludes goodwill. A block can produce short-term capital gain when consideration exceeds the block value.
Map each asset to the prescribed block; reconcile opening WDV; add actual cost; subtract transfer consideration; apply rate and half-year restriction; test block cessation.
Opening plant block ₹20 lakh, additions ₹8 lakh and sale proceeds ₹5 lakh leave ₹23 lakh before depreciation, subject to the period-of-use split.
The example is an illustration, not a substitute for the taxpayer's facts. A change in status, period, payment mode, document, city, asset, relationship or scheme can change the result.
Search pages often state a rate or limit without identifying the governing base. The calculation must distinguish gross receipt from taxable profit, tax from TDS, a deduction from an exemption, salary from business income, and an accounting entry from the tax treatment.
| Decision point | Required treatment |
|---|---|
| Legal year | Use the Act, rules and notification effective for the income or transaction period |
| Taxpayer category | Confirm residence, age, entity, employee/business status and regime |
| Calculation base | Use the statutory definition rather than CTC, net bank receipt or accounting label |
| Ceiling or rate | Apply actual-amount, percentage, shared, lifetime and gross-income limits in sequence |
| Documentation | Link every input to an invoice, statement, contract, certificate or official record |
| Final output | Show tax, surcharge, cess, interest and TDS/TCS credits separately |
This page is written around the entities and concepts search engines expect for the topic: business deduction, depreciation, section 33, section 37, cash payment. They are used only where relevant and are connected to the live calculator and knowledge hub rather than repeated mechanically.
For the complete rules on this topic, see the core guide: Business Income Tax Calculator India 2026: Profit-to-Tax Workflow.
See the broader Income-tax Act 2025 study guide hub for related rules and calculators on this topic.
Tax depreciation is calculated on a block of assets sharing class and rate, not separately on each asset. Opening WDV plus eligible additions minus sale proceeds forms the block base, subject to use and half-year rules.
Finin2min rule: establish eligibility, calculate transparently, and preserve an audit trail.
Use the current official instrument, portal or regulator publication before acting. This panel separates the category authority from page-specific references.