Depreciation calculator
A depreciation calculator spreads the cost of an asset over its useful life. This free tool computes depreciation three ways – the Companies Act written-down-value (WDV) method, the Companies Act straight-line method (SLM), and the Income Tax WDV method on blocks of assets. Enter the asset cost with either a useful life or a block rate, and it produces the depreciation amount, the closing book value, and a year-by-year schedule.
Asset details
Nothing is stored – calculated in your browser.
| Year | Opening | Depreciation | Closing |
|---|
Indicative only. Verify asset class, useful life and block rate against the Companies Act Schedule II and the Income Tax depreciation schedule for your specific asset.
How to calculate depreciation
- Enter the asset cost.
- Choose the method – Companies Act WDV or SLM, or Income Tax WDV.
- Add life or rate – residual value and useful life, or the block rate.
- Read the schedule – depreciation, closing value and the year-by-year table.
WDV vs SLM vs Income Tax
Under SLM the same amount is written off each year: (cost − residual value) ÷ useful life. Under WDV a fixed percentage is applied to the reducing book value, so the charge is largest in year one and tapers off. The Companies Act lets you use either, based on the useful life in Schedule II. The Income Tax Act mandates WDV on blocks of assets at fixed rates, with a half-rate in the first year if the asset is used for under 180 days.
Common Income Tax depreciation rates (WDV)
| Asset block | Rate |
|---|---|
| Buildings (general) | 10% |
| Furniture & fittings | 10% |
| Plant & machinery (general) | 15% |
| Motor vehicles | 15% |
| Computers & software | 40% |
Rates are indicative; confirm the exact rate for your asset block and year, as schedules are updated from time to time.
Worked example
Take an asset costing ₹10,00,000 with a ₹50,000 residual value over a 10-year life. Under SLM the annual depreciation is (10,00,000 − 50,000) ÷ 10 = ₹95,000 a year. Under WDV the derived rate is about 25.9%, so year-one depreciation is about ₹2,59,000, falling each year as the book value reduces. Under the Income Tax method at a 15% block rate, year-one depreciation is ₹1,50,000 (or ₹75,000 if used under 180 days).
Frequently asked questions
What is the difference between WDV and SLM depreciation?
Straight Line Method (SLM) charges the same depreciation every year - (cost minus salvage) divided by useful life. Written Down Value (WDV) charges a fixed percentage on the reducing book value, so depreciation is high in early years and falls over time. SLM suits assets that wear evenly; WDV front-loads the expense.
How is depreciation calculated under the Companies Act?
Schedule II of the Companies Act 2013 prescribes the useful life of each asset class. From the cost, residual value and useful life, you derive either an SLM amount or a WDV rate. This calculator computes both from the life and residual value you enter.
How does Income Tax depreciation differ?
The Income Tax Act uses the written-down-value method on blocks of assets at fixed rates - for example 15% for plant and machinery, 10% for furniture, and 40% for computers and software. If an asset is used for less than 180 days in the year it is bought, only half the rate applies that year.
What is the WDV depreciation rate formula?
The WDV rate that writes an asset down to its residual value over its life is rate = 1 minus the n-th root of (residual value divided by cost), where n is the useful life in years. This calculator derives it automatically for the Companies Act WDV method.
Is this depreciation calculator free?
Yes. It is free, needs no sign-up, and runs entirely in your browser. Nothing you enter is stored.
