Special Depreciation Method

In many countries, you are allowed to carry out special depreciations for your fixed assets. Usually, a certain percentage of the asset value can be depreciated in addition to the normal depreciation amount. The percentage allowed for the special depreciation, as well as the period over which you can carry out the special depreciation, are dependent on national legislation.

Note Note

In SAP Business One, special depreciation is always carried out in the first period of the concession years. For more information, see the examples below.

End of the note.

Special Depreciation Method

Calculation Method
Displays Additional, which suggests that special depreciation is always calculated in addition to the standard depreciation amount.

Pool of Depreciation Type
From the dropdown list, select a pool to which you want to assign the depreciation type. You must assign a special or manual depreciation type to a pool.

Normal Depreciation
Specify a depreciation type that is used for the regular automatic depreciation of an asset. You must specify a depreciation type whose method is not special depreciation.

Alternative Depreciation
To compare different depreciation calculations, specify a second depreciation type here. The system calculates the depreciation for this depreciation type in parallel. The result of the alternative calculation is for reference only, and no bookings are carried out in the general ledger. Recommendation You can specify the same depreciation type for the normal and alternative depreciation. This way, you can compare the asset depreciation with and without the special depreciation. End of the recommendation.

Concession Period (Years)
Enter the number of years during which the special depreciation is legally permitted. You can enter integers only.

Maximum Percentage
If required, enter the percentage rate for calculating the maximum depreciation amount allowed in addition to the normal depreciation. National legislation specifies this value. The system calculates the maximum special depreciation amount as follows: (Acquisition and Production Costs – Salvage Value) * Maximum Percentage

Maximum Amount
If required, enter the maximum depreciation amount allowed in addition to the normal depreciation. The maximum amount is an alternative to the maximum percentage.

To optimize depreciation from a tax point of view, you can split the concession period into multiple sub-periods and freely distribute the maximum percentage over these periods.

Number of Years
Specify the number of years in each period. You can enter integers only. Note The total number of years you enter must not exceed the concession period. End of the note.

Annual Percentage
Enter the annual percentage rate for the special depreciation calculation. Note The total percentage rate of all periods must not exceed the maximum percentage. End of the note.

Amount
Enter the annual special depreciation amount. Note The total amount for all periods must not exceed the maximum amount. End of the note.

Example Example

Asset X

Acquisition and Production Costs: 60,000 USD

Useful Life: 60 Months

Depreciation Type: Special Depreciation

Calculation Base: Yearly

Normal Depreciation: Depreciation Type 02 (Method = Straight Line; Calculation Base = Yearly; Calculation Method = Net Book Value/Remaining Life)

Capitalization Date: January 1st, 2010

Concession Period: 2 Years

Maximum Percentage: 30

Level	Number of Years	Annual Percentage
1	2	15

The system calculates the asset depreciation as follows:

2010–2011
The system first calculates the normal depreciation in 2010 and 2011 as follows:

2010: 60000 USD / 60 * 12 = 12000 USD

2011: (60000 USD – 12000 USD) / (60 – 12) * 12 = 12000 USD

Then, the special depreciation in each year is calculated as follows:

60000 USD * 15% = 9000 USD

Assuming your company's posting periods are months, SAP Business One carries out the special depreciation in the first month of 2010 and 2011, respectively.
2012–2014
The system calculates the depreciation from 2012 to 2014 as follows:

Note
Within the concession period, the special depreciation amount does not affect the calculation of the net book value. However, after the concession period, the calculation of the net book value takes into account the special depreciation amount.

End of the note.
- 2012
  (60000 USD – 12000 USD * 2 – 9000 USD * 2) / (60 – 12 * 2) * 12 = 6000 USD
- 2013
  (60000 USD – 12000 USD * 2 – 9000 USD * 2 – 6000 USD) / (60 – 12 * 3) * 12 = 6000 USD
- 2014
  60000 USD – 12000 USD * 2 – 9000 USD * 2 – 6000 USD * 2 = 6000 USD

	Jan.	Feb.	Mar.	Apr.	May	Jun.	Jul.	Aug.	Sep.	Oct.	Nov.	Dec.
2010	10000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000
2011	10000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000	1000
2012	500	500	500	500	500	500	500	500	500	500	500	500
2013	500	500	500	500	500	500	500	500	500	500	500	500
2014	500	500	500	500	500	500	500	500	500	500	500	500

End of the example.