Schedule II depreciation, worked on one laptop
By Blacrex · Not tax or audit advice.
What Schedule II says
“The useful life of an asset shall not ordinarily be different from the useful life specified in Part C and the residual value of an asset shall not be more than five per cent. of the original cost of the asset:”
Companies Act, 2013, Schedule II, as published on India Code
A different life or residual is allowed, with “justification in this behalf duly supported by technical advice”.
“End user devices, such as, desktops, laptops, etc.”
Schedule II, Part C, XII(ii) — life 3 Years
“the depreciation on such assets shall be calculated on a pro rata basis from the date of such addition or, as the case may be, up to the date on which such asset has been sold, discarded, demolished or destroyed.”
Schedule II, Note 2
What it does not say
For an asset like this laptop, Schedule II gives a useful life and a ceiling on the residual value. It does not name a method or a day count. It asks you to disclose the methods you use.
“(i) depreciation methods used; and”
Schedule II, Note 3
The inputs
- Cost
- ₹58,500.00
- In service
- 14 March 2024
- Class
- Computers — end-user devices — 3 years
- Residual
- 5% = ₹2,925.00
- Method
- Straight line — the company’s own disclosed choice
The arithmetic
58,500.00 − 2,925.00 = 55,575.00
55,575.00 ÷ 3 = 18,525.00 a year
FY 2023-24 has 366 days; 14 to 31 March is 18 days
18,525.00 × 18 ÷ 366 = 911.07
Year by year
| FY | Days in year | Depreciation at start | Charge | Depreciation at end | Book value at end |
|---|---|---|---|---|---|
| 2023-24 | 366 | ₹0.00 | ₹911.07 | ₹911.07 | ₹57,588.93 |
| 2024-25 | 365 | ₹911.07 | ₹18,525.00 | ₹19,436.07 | ₹39,063.93 |
| 2025-26 | 365 | ₹19,436.07 | ₹18,525.00 | ₹37,961.07 | ₹20,538.93 |
| 2026-27 | 365 | ₹37,961.07 | ₹17,613.93 | ₹55,575.00 | ₹2,925.00 |
The last year charges only what is left, so the book value lands on the ₹2,925.00 residual.
Our conventions, not the Act's
- A complete financial year charges the full annual amount.
- A part year takes its share by days over that year’s own length.
- The charge starts on the in-service date.
- The day an asset leaves is not charged.
Using a different life or residual
Schedule II lets you use a different useful life or residual value, with “justification in this behalf duly supported by technical advice”.
How the register does it
Blacrex keeps this working for every asset. The schedule is readable on screen on the free plan; the year-end download and Tally export are on the paid plans.