Recently, the CBDT has made changes in the Income Tax Rules to restrict the rate of depreciation maximum up to 40% for block of assets which are currently eligible for depreciation at a higher rate ( 50%, 60%, 80%, 100%).
- This amendment is applicable from current financial year itself (i.e. FY 2016-17) in case of new manufacturing companies(incorporated on or after 1.3.2016) which will opt for lower corporate tax rate of 25% under section 115BA of the Income Tax Act, 1961.
- For all other assessees, the above amendment is applicable from next year (i.e. FY 2017-18).
In this regard, we are pleased to attach our newsflash covering the gist of amendment.