Depreciation Rates Price Trend Analysis 2026: Supply Demand Analysis, Historical Prices, Market Insights, Latest News & Price Drivers

Depreciation is used to waver the costs of an asset past its useful life. It is a compulsory reduction in the profit and loss statement of the owner of these depreciable assets. Various tangible (building, machinery, plant, or furniture) and intangible (patents, copyrights, trademarks, etc.) assets have been grouped under the depreciable block. For residential buildings, not including boarding houses and hotels, a 5% depreciation rate is assigned, while for hotels and boarding houses, a 10%, and for temporary constructions like wooden buildings, a 40% depreciation rate is assigned.

For furniture, a 10%; for plants and machinery, excluding motor vehicles, 15-30% depreciation, while for motor vehicles, a 30–45% depreciation depending on their purchase and age is assigned. For computers, proposal software, and other software, 40%, while for books in annual publications, a 100% depreciation is allowed. For intangible assets, a depreciation of up to 25% is allowed.

Depreciation is defined as the reduction in the value of assets over time due wear and tear. As per the Income Tax  Act for AY 2022-23, no depreciation will be allowed if an asset is acquired in cash more than 10,000 INR in a day. However, a depreciation claim can be filed if the amount is up to 10,000 INR a day. The government came out with the list of commodities and the depreciation allowance as the percentage of the written down cost.

The building used for residential purposes other than hotels incurs a total of 5% depreciation allowance, whereas machinery and production plants, if not specified otherwise, incur an allowance of 15%. Similarly, moulds used in the rubber and polymer industry incur a depreciation allowance of 30%, while the machinery required in garment processing industries incurs a depreciation allowance of 40%.

Depreciation rates have been significant all through a wide range of products as in temporary constructions (wood structures, furniture, aesthetic designs, etc.). The depreciation incurrence on this class of products have witnessed a significant 40 %. Along the similar lines, electrical fixtures along with fittings and different furniture saw a depreciation dip of around 10 %.

Aeroplanes and Aeroengines incurred a depreciation of 40 %. Moreover, equipment catering to air pollution control such as Felt filtering system, scrubbers, dust collection, etc. incurred a depreciation of 40 %.