Depreciation Calculator – Straight-Line, Declining Balance & SYD
Work out how much an asset loses in value each year. Compare straight-line, double declining balance and sum-of-the-years’ digits depreciation and see a full schedule with book values.
Enter the purchase cost, the salvage value at the end and the useful life in years, then choose a method. Straight-line spreads the cost evenly: (20,000 − 2,000) ÷ 5 = 3,600 per year. Declining-balance methods write off more in the first years. The table shows depreciation, accumulated depreciation and book value for every year.
How to use Depreciation Calculator
- Enter the purchase cost of the asset.
- Enter the expected salvage (residual) value.
- Enter the useful life in years.
- Choose the depreciation method.
- Read the first-year amount and the yearly schedule.
The three main methods
| Method | Formula | Pattern |
|---|---|---|
| Straight-line | (cost − salvage) ÷ life | Same amount every year |
| Double declining balance | book value × 2 ÷ life | High at first, then lower |
| Sum-of-the-years’ digits | (cost − salvage) × remaining life ÷ SYD | High at first, falling steadily |
Example: a machine costs 20,000, has a salvage value of 2,000 and a life of 5 years. Straight-line depreciation is 3,600 per year. With double declining balance the first year is 20,000 × 40 % = 8,000; with sum-of-the-years’ digits (SYD = 1+2+3+4+5 = 15) it is 18,000 × 5/15 = 6,000.
Which method to choose
Straight-line is the simplest and the most common in financial statements. Declining-balance methods match assets that lose value quickly, such as vehicles, computers and phones, and give larger tax deductions early where tax rules allow them. The calculator switches double declining balance to straight-line in the year when that gives a higher amount, and it never depreciates below the salvage value.
Tax rules differ
Tax authorities usually set their own rules: fixed useful lives per asset type, special methods such as MACRS in the US or capital allowances in the UK, and limits on declining-balance rates. Use this calculator to understand and plan, and follow your local rules or an accountant for your tax return. This is general information, not tax advice.
Book value and resale
Book value is cost minus accumulated depreciation. It is an accounting value, not the market price — a well-kept car may sell for more than its book value, a computer for less. When you sell an asset, the difference between price and book value is a gain or loss.
Related calculators
For returns on an investment, see the ROI Calculator; for financing an asset, the Loan Calculator; for prices with a profit, the Markup Calculator. All schedules are calculated in your browser.
You may also find these free tools useful: Compound Interest Calculator, Fuel Cost Calculator and Electricity Cost Calculator.
Frequently asked questions
How do I calculate straight-line depreciation?
Subtract the salvage value from the cost and divide by the useful life: (20,000 − 2,000) ÷ 5 = 3,600 per year.
What is double declining balance?
Each year you depreciate the book value at twice the straight-line rate, so early years get larger amounts.
What is salvage value?
The estimated value of the asset at the end of its useful life. It is not depreciated.
What is book value?
Cost minus accumulated depreciation — the value shown in the accounts.
Can I use this for my tax return?
Use it to plan. Tax rules set their own lives and methods, so check local rules or ask an accountant.
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