Skip to content

CS Executive · Tax Laws and Practice · Profits and Gains from Business and Profession

Under the Income-tax Act, 2025 (applicable from the June 2027 session), which of the following intangible assets is eligible for depreciation under section 33?

A franchise used wholly and exclusively for business qualifies for depreciation under section 33 of the Income-tax Act, 2025. Franchises are listed intangible assets, whereas goodwill is expressly excluded and patents acquired before 1 April 1998 fall outside the eligible acquisition date.

  1. AGoodwill of a business acquired on purchase of a going concern
  2. BA franchise acquired by the assessee and used wholly and exclusively for businessCorrect
  3. CA patent acquired before 1 April 1998
  4. DGoodwill of a profession built up over the years

Explanation

Section 33 allows depreciation on know-how, patents, copyrights, trademarks, licences, franchises and similar business or commercial rights acquired on or after 1 April 1998, but excludes goodwill. A franchise used wholly and exclusively for business therefore qualifies. The pre-1998 patent is outside the cut-off date, and both goodwill options are expressly excluded.

Did you get it right without looking?

One question tells you little. A timed set on Profits and Gains from Business and Profession shows your real accuracy, how long you take and where you lose marks.

Practise Profits and Gains from Business and ProfessionFree diagnostic mock

More Profits and Gains from Business and Profession questions