Property Depreciation Calculator: SLM vs WDV

Building Asset Inputs

Building Superstructure Cost (Excl Land)

₹

Building Asset Category (Income Tax Act)

Depreciation Duration

Yrs

SLM vs WDV Depreciation Rules (Income Tax Act 2026)

Depreciation allows property owners to claim structural wear and tear as an expense to reduce business income tax liabilities.

Depreciation Method	Calculation Formula	ITR Filing Mandate
Written Down Value (WDV)	Depreciation = Opening Book Value * Rate%	Mandatory for Income Tax (Block of Assets)
Straight Line Method (SLM)	Depreciation = Cost / Useful Life Years	Allowed for Companies Act Financial Reporting

Income Tax Act 10% WDV Building Depreciation Rules

Block of Assets (10% Rate): Residential and commercial buildings used for business/profession qualify for 10% annual Written Down Value (WDV) depreciation under Section 32.
Land Non-Depreciable: Land value CANNOT be depreciated. Only the cost of the building structure is eligible for tax depreciation.

SLM vs WDV Method Comparison

Straight Line Method (SLM): Equal annual depreciation charged based on initial asset cost over its useful life (Companies Act financial reporting).
Written Down Value (WDV): Higher depreciation claimed in early years based on reducing book value (Income Tax Act compliance).

Tax Shield Insight

Claiming 10% WDV building depreciation generates a non-cash tax shield, significantly reducing your taxable business profit and net tax payout!

Frequently Asked Questions

What is the Income Tax depreciation rate for commercial buildings in India?

Under Section 32 of the Income Tax Act, commercial and industrial building blocks attract a mandatory 10% depreciation rate on Written Down Value (WDV).

Is land value eligible for income tax depreciation?

No! Land is an appreciating asset and does NOT qualify for depreciation under Income Tax laws. Depreciation is allowed only on the building superstructure cost.

What is the difference between SLM and WDV depreciation methods?

SLM (Straight Line Method) charges a fixed equal depreciation amount every year based on original cost. WDV (Written Down Value) charges a fixed percentage on the opening reduced balance each year.

Which depreciation method is mandatory for Income Tax filing in India?

For income tax returns (ITR), the WDV method on Block of Assets is mandatory for all businesses and commercial property owners (except power generation undertakings).

What is the depreciation rate for residential buildings rented out?

Residential buildings used for business or rented out attract a 5% WDV depreciation rate under Income Tax Act rules.

What is the Half-Year Depreciation rule (180 days rule)?

If a property asset is acquired and put to use for less than 180 days in a financial year, only 50% of the normal annual depreciation rate is allowed for that first year.

How does property depreciation save income tax?

Depreciation is a non-cash expense that is deducted from business or rental income, reducing net taxable profits and overall tax liability.

What happens when a depreciated property asset is sold?

When a depreciable block of assets is sold, the net sales proceeds reduce the block value. If proceeds exceed the block WDV, it results in Short Term Capital Gains (STCG) under Section 50.

Property Depreciation SLM vs WDV Calculator (2026)