Depreciation calculator
Work out how much a business asset loses in value each year and its book value: a car, machine, computer or fixtures. Straight-line (same each year) or declining balance (fixed percentage of book value).
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Which useful life and method are allowed for tax is something to settle with your accountant. Declining balance here uses twice the straight-line rate and switches to straight-line once that gives more.
Depreciation in practice
Depreciation spreads the cost of something you use for years over those years. Straight-line: (cost minus residual value) divided by the number of years. A car of SRD 600,000 with SRD 100,000 residual value over 5 years is SRD 100,000 a year.
- Land is not depreciated; a building is, over a long period.
- Small purchases are usually expensed at once. Your accountant knows which limit the tax office uses.
- Depreciation is a cost in your profit and loss account, but no money leaves your account. That is why profit is lower than cash flow.
- When you sell the asset, the difference between sale price and book value is a gain or a loss.
A helpful tool, not tax or legal advice. Check important amounts.