How to Calculate Vehicle Depreciation Rate?
1 Answers
There are three methods to calculate vehicle depreciation rate: 1. Depreciation percentage = 2 / estimated useful life. 2. Depreciation amount = original value (remaining usable years / total sum of useful years). 3. Annual depreciation amount = original value / estimated useful life. Below are relevant details about depreciation: 1. Depreciation method: The straight-line method is recommended, firstly because it is simple and easy to implement, and secondly because it complies with the relevant provisions of the "Implementation Regulations of the Enterprise Income Tax Law of the People's Republic of China". Article 59 of these regulations clearly states that "depreciation calculated using the straight-line method for fixed assets is deductible". Article 60 further specifies the minimum depreciation period for fixed assets: "Transportation tools other than aircraft, trains, and ships, 4 years". 2. Electronic equipment and transportation tools other than trains and ships, as well as tools, furniture, etc. related to production and operation, have a depreciation period of 5 years, with a residual value ratio uniformly set at 5% of the original price. Therefore, according to tax law, passenger cars have a depreciation period of 5 years and a residual value rate of 5%. Even for used cars, their depreciation period is calculated as 5 years from the date of purchase.
