Depreciation Calculator
Work out an asset’s depreciation and book value year by year with straight-line, double-declining balance, 150% declining balance or sum-of-the-years’ digits, from its cost, salvage value and useful life.
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How do I calculate depreciation?
Straight-line depreciation spreads the cost minus the salvage value evenly over the asset’s life. A machine costing 10,000, worth 1,000 after 5 years, depreciates (10,000 − 1,000) ÷ 5 = 1,800 a year. Double-declining balance front-loads it instead: 4,000, then 2,400, 1,440, 864 and 296.
- Enter the asset’s cost, its expected salvage value at the end, and its useful life in whole years.
- Choose a method: straight-line, double-declining balance, 150% declining balance or sum-of-the-years’ digits.
- Read the depreciation, accumulated depreciation and book value for each year in the table.
Formulas & Methods
Straight-line
Example: (10,000 − 1,000) ÷ 5 = 1,800 a year
Double-declining balance
Example: 10,000 × 40% = 4,000 in year 1; 6,000 × 40% = 2,400 in year 2
Sum-of-the-years’ digits
Example: 9,000 × 5 ÷ 15 = 3,000 in year 1
Key features
Four methods
Straight-line, double-declining, 150% declining balance and sum-of-the-years’ digits, on the same asset.
Year-by-year table
Depreciation, accumulated depreciation and book value at the end of each year.
Never below salvage
Declining balance switches to straight-line when that gives more, so the full amount is written off by the last year without overshooting.
Common uses
- Plan the yearly expense of equipment, vehicles or computers
- See an asset’s book value before selling it
Accounting depreciation and tax depreciation
These are the standard accounting methods for a business’s own books. Tax authorities often set their own rules, rates and asset classes, such as MACRS in the United States or capital allowances in the UK, and may require a part-year convention for the year the asset is bought. This calculator uses whole years, so check the rules that apply before using it for a tax return.
Frequently Asked Questions
What is salvage value?
What you expect the asset to be worth at the end of its useful life, when you sell or scrap it. Depreciation only writes off the cost above it. Enter 0 if you expect it to be worth nothing.
Why use an accelerated method?
Many assets lose value fastest when new, and accelerated methods such as double-declining balance put more of the expense in the first years to match. The total written off is the same as with straight-line.
What does book value mean?
The cost minus the depreciation recorded so far. It is an accounting figure and can differ from what the asset would sell for.
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