Depreciation calculation methods

Depreciation calculation methods define how annual depreciation is calculated. Each asset within the Asset Management application must have one depreciation calculation method assigned to it. You can assign one of the Asset Management application predefined depreciation calculation methods to the asset, or you can create a custom depreciation calculation method.

Note: Depreciation methods are irrelevant for Part 32 asset books.

Part 32 book

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The Asset Management application predefined depreciation calculation methods Predefined Asset Management Depreciation Calculation Methods
Creating custom depreciation calculation methods Using custom depreciation calculation methods

Predefined Asset Management Depreciation Calculation Methods

The Asset Management application contains fourteen predefined depreciation calculation methods:

  • 125DB (125% declining balance)

  • 150DB (150% declining balance)

  • 150DB20% (150% declining balance with 20% bonus depreciation)

  • 150DB30% (150% declining balance with 30% bonus depreciation)

  • 150DB50% (150% declining balance with 50% bonus depreciation)

  • 150DB60% (150% declining balance with 60% bonus depreciation)

  • 150DB80% (150% declining balance with 80% bonus depreciation)

  • 175DB (175% declining balance)

  • 200DB (200% declining balance)

  • 200DB20% (200% declining balance with 20% bonus depreciation)

  • 200DB30% (200% declining balance with 30% bonus depreciation)

  • 200DB50% (200% declining balance with 50% bonus depreciation)

  • 200DB60% (200% declining balance with 60% bonus depreciation)

  • 200DB80% (200% declining balance with 80% bonus depreciation)

  • SL (Straight line)

  • SL20% (Straight line with 20% bonus depreciation)

  • SL30% (Straight line with 30% bonus depreciation)

  • SL50% (Straight line with 50% bonus depreciation)

  • SYD (Sum of the year's digits)

  • 100%BONUS (100% bonus depreciation)

    Note: If the asset has a personal use limit, then the 100% bonus depreciation needs to be limited to the business use basis amount.
    Note: The depreciable basis is the total amount that is depreciated.

  • SLBZERO (Straight line below zero)

    Note: This method cannot be used on the posting book.

This table shows the formulas used for calculating annual depreciation for each depreciation calculation method.

Method Annual calculation formula
125DB

1.25 * [(Depreciable basis - Life-to-date depreciation + Year-to-date depreciation) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB

1.5 * [(Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB20%

1.5 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .2)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB30%

1.5 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .3)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB50%

1.5 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .5)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB60%

1.5 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .6)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

150DB80%

1.5 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .8)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

175DB

1.75 * [(Depreciable basis - Life-to-date depreciation + Year-to-date depreciation) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB

2 * [(Depreciable basis - Life-to-date depreciation + Year-to-date depreciation) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB20%

2 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .2)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB30%

2 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .3)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB50%

2 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .5)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB60%

2 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .6)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

200DB80%

2 * [((Depreciation basis - Life-to-date depreciation + Year-to-date depreciation) - (Depreciation basis * .8)) / (Asset life in months / 12)]

Depreciation calculations stop when:

Depreciable basis - Life-to-date = Salvage value

SL (Depreciable basis - Salvage value - Life-to-date depreciation + Year-to-date depreciation) / (Remaining life in months at beginning of year / 12)
SL20% ((Depreciable basis - Salvage value - Life-to-date depreciation + Year-to-date depreciation) - (Depreciable basis * .2)) / (Remaining life in months at beginning of year / 12)
SL30% ((Depreciable basis - Salvage value - Life-to-date depreciation + Year-to-date depreciation) - (Depreciable basis * .3)) / (Remaining life in months at beginning of year / 12)
SL50% ((Depreciable basis - Salvage value - Life-to-date depreciation + Year-to-date depreciation) - (Depreciable basis * .5)) / (Remaining life in months at beginning of year / 12)
SYD (Depreciable basis - Salvage value) * [(Life remaining in years) / (Life in years * {Life in years + 1} / 2)]
100%BONUS 100%BONUS = Depreciation basis
SLBZERO (Depreciable basis - Salvage value * 12) / Life

Using custom depreciation calculation methods

In addition to offering predefined depreciation calculation methods, the Asset Management application lets you to define custom depreciation calculation methods. Defining depreciation calculation methods