📉 Depreciation Calculator

The Depreciation Calculator builds a full year-by-year depreciation schedule for a business asset, showing exactly how much value it loses each year and what it's worth on the books at any point. It supports straight-line depreciation as well as two accelerated declining-balance methods, so you can compare how the choice of method changes the timing of the expense. This is an estimate for planning purposes — consult a licensed accountant or tax professional for filing.

How It Works

Enter the asset's original cost, its estimated salvage value at the end of its useful life, the number of years in that useful life, and a depreciation method. Under straight-line, the calculator subtracts salvage value from cost and divides evenly across every year. Under double-declining balance or 150% declining balance, it applies a fixed rate (2 ÷ useful life, or 1.5 ÷ useful life) to the asset's remaining book value each year, which produces larger deductions early on and smaller ones later — with a final "plug" year that brings the book value down to exactly the salvage value rather than below it.

Why It Matters

Depreciation schedules matter for both accounting and tax planning: they determine how much expense hits the income statement each period and how much taxable income is reduced each year. Because depreciation is a non-cash expense, it doesn't affect cash flow directly, but it does affect reported profit and the taxes a business owes — accelerated methods can improve near-term cash position by lowering tax bills sooner, even though total depreciation over the asset's life is the same under any method.

Tips for Accurate Results

• Estimate salvage value conservatively and realistically — declining balance methods stop depreciating once book value reaches salvage, so an inflated salvage figure understates your deductible expense.
• Use double-declining or 150% declining balance for assets that lose usefulness quickly (vehicles, computers, machinery); use straight-line for assets that wear evenly (furniture, buildings).
• Remember that total depreciation over the asset's full useful life is always Cost − Salvage Value, no matter which method you choose — only the year-by-year timing changes.
• For actual tax filing, many jurisdictions require specific systems (like MACRS in the US) rather than these simplified methods — treat this schedule as a planning tool and confirm the applicable rules with a CPA.