Breakdown
How it works
Straight-line spreads (cost − salvage) evenly. Declining balance applies a fixed rate (2× or 1.5× the straight-line rate) to the opening book value, front-loading the charge and switching to clear the salvage in the final year. Sum-of-years' digits weights early years by remaining life.
Formula
Worked example
50,000 cost, 5,000 salvage, 5 years: SL 9,000 a year; DDB year 1 = 20,000; SYD year 1 = 15,000.
Frequently asked questions
Which method should I use?
Straight-line for most assets under IFRS/GAAP unless consumption is clearly front-loaded (vehicles, IT). Tax depreciation follows local rules regardless.
What is the UAE corporate tax treatment?
Accounting depreciation is generally accepted for corporate tax, with specific rules for realisation basis and revaluation.
How do I handle a mid-year purchase?
Pro-rate the first year by months (or use a half-year convention); the schedule then extends one extra partial year.