Investment Property Depreciation Calculator

Estimate investment property depreciation and potential building and asset deductions.

Compare straight-line vs diminishing value methods and see how each affects your numbers.

The item

Item cost

What you paid for the capital improvement or asset — e.g. a new oven, air conditioner, carpet or hot water system.

Effective life (years)

How many years the item is expected to last. This sets the pace for both methods.

Diminishing value rate

The diminishing value method applies a multiple of the straight-line rate to the value that's left each year. 200% is the most widely used.

Value remaining over time

Written-down value of the item at the end of each year.

Straight-lineDiminishing value

Straight-line

A$2,000 / year

The same claim every year for 10 years, then the item is fully written off.

Diminishing value

A$4,000 in year 1

A bigger claim up front — A$4,000 in year 1 versus A$2,000 — that shrinks each year and leaves about A$2,147 still on the books after 10 years.

Both methods write off the same item — they just spread the deductions differently over time. Figures update as you type and are a simplified illustration only.

Two ways to depreciate the same item

Depreciation spreads the cost of a capital item across the years it's used, rather than claiming it all at once. There are two common methods — they write off the same total, just on a different schedule.

Straight-line

Cost ÷ effective life = same amount each year

Also called the prime cost method. You claim an equal slice of the original cost every year until the item is fully written off. It's simple and predictable — a $20,000 item over 10 years is $2,000 a year, every year.

Diminishing value

Remaining value × fixed rate = a shrinking amount

You apply a fixed rate to the value that's left each year, so the deduction is largest in year one and gets smaller over time. You claim more sooner, but the item is never quite written down to zero within its effective life.

Which shows more early on?

Diminishing value front-loads the deductions — you claim more in the early years and less later. Straight-line spreads them evenly. Both methods eventually account for the same item; the difference is purely about timing. The chart above makes this clear: switch between Value to see the written-down value fall, and Yearly claim to see how the annual deduction differs between the two.

What is "effective life"?

The effective life is how long an item is expected to be usable — a carpet might be 8 years, an air conditioner 10, an oven 12. It sets the pace of depreciation for both methods: a longer life means a smaller deduction each year, spread over more years. If you're unsure, your accountant or a quantity surveyor can advise the right figure for a given item.

Track it automatically in Akweno

Record a capital improvement against a property in Akweno and it keeps a running written-down value for each item, so you always know what a renovation or appliance is still worth on the books. Start free.

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