Is There Depreciation Compensation for a Rear-Ended Vehicle?
1 Answers
After a vehicle is rear-ended with the other party being fully at fault, there is no legal provision for depreciation compensation, but you can negotiate the matter with the other party. Here is relevant information about vehicle depreciation compensation: 1. Definition of Vehicle Depreciation Compensation: Vehicle depreciation compensation is the financial manifestation of vehicle investment recovery. It involves withdrawing a certain amount of funds annually to update vehicles and maintain transportation reproduction. Vehicle depreciation compensation does not reflect the national economy's investment in transportation vehicles; what effectively reflects the economic price of vehicle depreciation is the vehicle's capital recovery cost. 2. Regulations on Depreciation Period: According to tax laws, passenger cars have a depreciation period of 5 years with a residual value rate of 5%. Even for used cars, the depreciation period is calculated as 5 years from the date of purchase. Tax laws stipulate the following minimum depreciation periods for fixed assets: 20 years for houses and buildings; 10 years for trains, ships, machinery, and other production equipment; and 5 years for electronic equipment, transportation tools other than trains and ships, as well as tools, furniture, and other items related to production and operation, with a unified residual value ratio of 5% of the original price. The higher the depreciation rate, the worse the vehicle's condition and the lower its residual value.
