Declining Balance and Double Declining Depreciation
Calculate declining balance or double declining balance depreciation with your own rate, an optional switch to straight line, and a year-by-year book value schedule.
Leave blank for 0.
Leave blank for a full first year.
Applied to the opening book value each year. Book value never drops below salvage.
Enter the asset cost, useful life and a yearly rate to see the depreciation schedule.
About the declining balance depreciation calculator
Declining balance is an accelerated method: it charges the largest expense in the first year and a smaller one every year after. Instead of dividing cost by life, it takes a fixed percentage of the opening book value each year, and that book value shrinks as depreciation accumulates. This Declining Balance Depreciation Calculator covers both the general method, where you choose the rate, and double declining balance, where the rate is fixed at twice the straight-line rate.
Front-loaded depreciation suits assets that lose value quickly or become obsolete early, such as computers, vehicles and electronics. It also moves expense into the early years, which lowers reported profit sooner.
How to use it
Steps
- Enter the Asset cost, the Salvage value (blank for 0) and the Useful life in years.
- Choose Declining balance and enter a Rate (% per year), for example 30. Or choose Double declining balance, where the rate is 2 divided by the life.
- For double declining balance, decide whether to Switch to straight line when it gives more. It is on by default.
- Optionally enter the months in service if the first year is partial.
- Read the schedule and copy it as CSV if you need it elsewhere.
Formulas
Depreciation is capped each year so book value never falls below salvage. With a partial first year, year 1 is prorated by the months in service, and a final row covers the leftover months.
Declining balance is not forced to salvage
With a rate you choose, the schedule might not reach salvage. A low rate leaves book value above it at the end of the life, and the calculator tells you by how much rather than inventing a final adjustment. A high rate reaches salvage early, after which depreciation is zero.
Example, rate too low. An asset costs 25,000 with 2,000 salvage and a 6-year life, depreciated at 30 percent. Depreciation runs 7,500, 5,250, 3,675, 2,572.50, 1,800.75 and 1,260.52. Book value ends at 2,941.23, which is 941.23 above salvage. At 40 percent the same asset reaches 2,000 in year 5, because the fifth amount is capped at 1,240 instead of 1,296, and year 6 is zero.
Double declining balance and the switch to straight line
Because the declining amount keeps shrinking, a pure double declining schedule can leave a lot of undepreciated cost in the late years. Two conventions handle this.
Switch on. Each year, compare the declining amount with the straight-line amount for the remaining life and take the larger one. A cost of 10,000, no salvage and a 5-year life gives 4,000, 2,400 and 1,440, then 1,080 and 1,080, because straight line on the remaining 2,160 beats 864 in year 4.
Switch off. The textbook rule takes the declining amount every year and gives the final year whatever remains. The same asset shows 4,000, 2,400, 1,440, 864 and 1,296.
A larger asset. With 50,000 cost, 5,000 salvage and a 10-year life, the rate is 20 percent. Depreciation runs 10,000, 8,000, 6,400, 5,120, 4,096, 3,276.80, 2,621.44 and 2,097.15. In year 9 the declining amount would be 1,677.72, but straight line on the remaining 3,388.61 over two years gives 1,694.30, so the schedule switches, and year 10 is also 1,694.30. With the switch off, year 9 is 1,677.72 and year 10 takes the remaining 1,710.89. Either way the total is 45,000.
Choosing a rate
Common choices are 150 percent or 200 percent of the straight-line rate. For a 5-year life the straight-line rate is 20 percent, so 150 percent declining balance is 30 percent and 200 percent is 40 percent. Tax systems often prescribe their own tables, so use this tool for books, planning and study.
Privacy
Nothing is uploaded; every calculation runs in your browser and never leaves your device.
Related tools
The Depreciation Calculator compares declining balance with straight line, sum-of-years digits and units of production. Use the Percentage Calculator to turn a rate into an amount, and the Loan Calculator if you are financing the asset.
Frequently asked questions
How is declining balance depreciation calculated?
Each year's depreciation is the opening book value multiplied by the rate. A 10,000 asset at 20 percent depreciates 2,000 in year 1, then 1,600 on the remaining 8,000, then 1,280, and so on. Salvage value is not subtracted before applying the rate, but book value is never allowed to go below it.
What is double declining balance?
It is declining balance with a rate of twice the straight-line rate, which is 2 divided by the useful life. A 5-year asset therefore uses 40 percent and a 10-year asset uses 20 percent of the opening book value each year.
What does 'switch to straight line when it gives more' do?
Each year the calculator compares the declining amount with the straight-line amount for the remaining life, which is opening book value minus salvage divided by the years left including the current one. It takes the larger. For a 10,000 asset with no salvage and a 5-year life, that gives 4,000, 2,400, 1,440, 1,080 and 1,080.
What happens if I turn the switch off?
The calculator takes the declining amount every year and the final year takes whatever remains above salvage, which is the textbook convention. The same 10,000 asset shows 4,000, 2,400, 1,440, 864 and 1,296. Book value still never falls below salvage.
Why does my schedule end above salvage value?
With your own rate, declining balance does not have to reach salvage. If the rate is low, the book value after the last year stays above salvage and the page shows a note with the difference. Raise the rate or choose double declining balance if you need the asset written down to salvage.
Why is depreciation zero in the later years?
A high rate can take book value down to salvage early. The amount in that year is capped so the book value stops exactly at salvage, and later years show zero depreciation because there is nothing left to write off.
How does a partial first year change the result?
Year 1 is prorated by the months in service divided by 12, and the schedule gets a final row that covers the remaining months at the same rate. Later years are unchanged in length.