A worked example
A $50,000 asset with a $5,000 salvage value over a 5-year life depreciates by exactly $9,000 every year under straight-line. Under double-declining balance, year one alone deducts $20,000 — more than double — with the deduction shrinking each year after.
Frequently asked questions
Which method should I actually use?
Straight-line is simpler and most common for financial reporting. Declining balance methods are sometimes used (and may be required) for tax depreciation in certain jurisdictions, since many assets genuinely lose value faster early on. Check with an accountant for what applies to your specific situation.
What is 'salvage value'?
The estimated resale or scrap value of the asset at the end of its useful life — depreciation only reduces book value down to this floor, never below it.
Why does double-declining balance front-load the deduction?
It applies a fixed rate (double the straight-line rate) to the remaining book value each year, which is largest in year one and shrinks every year after — mirroring how many assets, like vehicles or equipment, lose value fastest when new.
This calculator provides general estimates only and is not tax or accounting advice. Consult a qualified accountant for the depreciation method and schedule that applies to your situation.