Depreciation Calculator
Calculate tax depreciation for business assets using ATO effective life rates and methods.
Calculate Asset Depreciation
Common Asset Effective Life (ATO)
| Asset | Effective Life | Prime Cost Rate | Diminishing Rate |
|---|---|---|---|
| Motor vehicle (car) | 8 years | 12.5% | 25% |
| Laptop/notebook computer | 4 years | 25% | 50% |
| Desktop computer | 4 years | 25% | 50% |
| Mobile phone | 3 years | 33.33% | 66.67% |
| Office furniture | 10 years | 10% | 20% |
| Air conditioning unit | 10 years | 10% | 20% |
| Printer | 5 years | 20% | 40% |
| Camera (digital) | 5 years | 20% | 40% |
| Power tools | 5 years | 20% | 40% |
| Software (in-house) | 5 years | 20% | 40% |
Diminishing value rate = (200% / Effective Life). Prime cost rate = (100% / Effective Life).
Instant Asset Write-Off (2024-25)
| Financial Year | Threshold | Eligibility |
|---|---|---|
| 2024-25 | $20,000 | Small business (turnover <$10M) |
| 2023-24 | $20,000 | Small business (turnover <$10M) |
| 2022-23 | $150,000 | COVID extended (ended) |
| 2020-22 | Unlimited | Full expensing (COVID) |
For 2024-25: Small businesses (turnover under $10M) can instantly write off assets costing less than $20,000. Each asset is assessed individually.
Prime Cost vs Diminishing Value
Prime Cost Method
- • Equal deductions each year
- • Formula: Cost × (100% / Effective Life)
- • Better for assets that depreciate evenly
- • Simpler to calculate
- • Example: $10,000 over 5 years = $2,000/year
Diminishing Value Method
- • Higher deductions in early years
- • Formula: Base Value × (200% / Effective Life)
- • Better for assets that lose value quickly
- • Reduces each year as base value falls
- • More common for technology, vehicles
Depreciation Tips
Record Keeping
- • Keep purchase receipts for 5 years
- • Document business use percentage
- • Track disposal/sale of assets
- • Use an asset register
Mixed Use Assets
- • Only claim business portion
- • Car logbook substantiates %
- • WFH equipment: actual work %
- • Be reasonable and consistent