Depreciation Calculator — Straight Line and WDV
Enter the cost, the residual value and either the useful life or the rate. Get the depreciation for every year and the book value at the end of each.
SLM only. Usually up to 5% of cost.
SLM only. General plant & machinery: 15 years (Schedule II).
WDV only. Income tax: 15% plant & machinery, 40% computers, 10% furniture.
Depreciation schedule
- Year 1 (closing ₹9,36,666.67)
- ₹63,333.33
- Year 2 (closing ₹8,73,333.33)
- ₹63,333.33
- Year 3 (closing ₹8,10,000.00)
- ₹63,333.33
- Year 4 (closing ₹7,46,666.67)
- ₹63,333.33
- Year 5 (closing ₹6,83,333.33)
- ₹63,333.33
- Total over 5 years
- ₹3,16,666.67
Book value after year 5: ₹6,83,333.33.
Quick answer
Straight line method: Depreciation = (Cost − Residual value) ÷ Useful life, the same every year. Written down value method: Depreciation = Opening book value × Rate %, so the charge falls each year. Under the Companies Act, 2013 assets are depreciated over their useful life (Schedule II); for income tax, blocks of assets are depreciated on WDV at set rates.
| Straight line (SLM) | (Cost − Residual) ÷ Useful life |
|---|---|
| Written down value (WDV) | Opening value × Rate % |
| Companies Act residual | Usually up to 5% of cost |
| Income tax, plant & machinery | 15% WDV (general rate) |
| Used under 180 days | Half the rate in the first year (income tax) |
Depreciation spreads the cost of a machine, a vehicle or a computer over the years it earns money, instead of charging it all in the year it was bought. The two methods in everyday use in India are straight line, which charges the same amount each year, and written down value, which charges a fixed percentage of the reducing balance.
Companies follow Schedule II of the Companies Act, 2013, which works from each asset's useful life. Income tax uses its own rates on blocks of assets, always on WDV. The two give different figures for the same machine, which is why the books and the tax computation differ. Rates and limits as of 13 October 2026.
The formula
- Straight line method
(Cost − Residual value) ÷ Useful life in years- SLM rate
(Cost − Residual) ÷ Useful life ÷ Cost × 100- Written down value method
Opening book value × Rate % ÷ 100- Closing book value
Opening book value − Depreciation for the year
A worked example: SLM and WDV
A CNC machine costs ₹10,00,000 with a residual value of ₹50,000 and a useful life of 15 years. Straight line depreciation = (10,00,000 − 50,000) ÷ 15 = ₹63,333 a year, every year, until the book value reaches ₹50,000.
On written down value at 15%: year 1 = ₹1,50,000 (closing ₹8,50,000); year 2 = ₹1,27,500 (closing ₹7,22,500); year 3 = ₹1,08,375. The charge is heavier early and lighter later — closer to how a machine actually loses value.
Useful lives and tax rates you will meet most
Schedule II of the Companies Act gives useful lives such as 15 years for general plant and machinery, 3 years for computers (6 for servers and networks), 10 years for furniture and fittings, 8 years for motor cars and 30 years for factory buildings. A company may use a different life if it is technically justified and disclosed.
For income tax the common WDV rates are 15% for general plant and machinery and motor cars, 40% for computers and software, 10% for furniture and fittings, and 10% for buildings other than residential. An asset put to use for less than 180 days in the year of purchase gets half the rate in that year.
Recording depreciation
The journal entry is Depreciation A/c Dr, To Asset A/c (or To Accumulated Depreciation A/c). Depreciation is a non-cash expense: it reduces profit and the asset's book value but no money leaves the business.
A fixed asset register — cost, date put to use, method, rate and accumulated depreciation for each asset — is what auditors ask for. Keeping it alongside purchase records avoids rebuilding it every March.
Questions people ask.
What is the formula for depreciation?
Straight line: (Cost − Residual value) ÷ Useful life. Written down value: Opening book value × Rate %. The calculator does both and shows the schedule.
Which depreciation method is better, SLM or WDV?
SLM gives an even charge and suits assets that wear evenly, such as buildings. WDV charges more in the early years and suits machinery and vehicles that lose value fastest when new. Income tax always uses WDV.
What is the depreciation rate on plant and machinery?
For income tax, 15% on WDV for general plant and machinery. Under the Companies Act, general plant and machinery has a useful life of 15 years, roughly 6.33% a year on SLM with a 5% residual.
What is the 180-day rule for depreciation?
For income tax, an asset put to use for less than 180 days in the year it was acquired is depreciated at half the normal rate in that year. The calculator has a switch for it.
What is residual value?
The amount expected from the asset at the end of its useful life, as scrap or sale. Under Schedule II it is normally not more than 5% of the original cost.
Is depreciation charged on land?
No. Land does not wear out, so it is not depreciated. Buildings on the land are.
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