');--input-focus-border-color:Highlight;--input-focus-outline:1px solid Canvas;--input-unfocused-border-color:transparent;--input-disabled-border-color:transparent;--input-hover-border-color:#000}@media (forced-colors:active){:root{--input-focus-border-color:CanvasText;--input-unfocused-border-color:ActiveText;--input-disabled-border-color:GrayText;--input-hover-border-color:Highlight}.annotationLayer .buttonWidgetAnnotation.checkBox input:required,.annotationLayer .buttonWidgetAnnotation.radioButton input:required,.annotationLayer .choiceWidgetAnnotation select:required,.annotationLayer .textWidgetAnnotation input:required,.annotationLayer .textWidgetAnnotation textarea:required{outline:1.5px solid selectedItem}}.annotationLayer{--scale-factor:1;left:0;pointer-events:none;position:absolute;top:0;transform-origin:0 0}.annotationLayer section{box-sizing:border-box;pointer-events:auto;position:absolute;text-align:initial;transform-origin:0 0}.annotationLayer .buttonWidgetAnnotation.pushButton>a,.annotationLayer .linkAnnotation>a{font-size:1em;height:100%;left:0;position:absolute;top:0;width:100%}.annotationLayer .buttonWidgetAnnotation.pushButton>canvas{height:100%;width:100%}.annotationLayer .buttonWidgetAnnotation.pushButton>a:hover,.annotationLayer .linkAnnotation>a:hover{background:#ff0;box-shadow:0 2px 10px #ff0;opacity:.2}.annotationLayer .textAnnotation img{cursor:pointer;height:100%;position:absolute;width:100%}.annotationLayer .buttonWidgetAnnotation.checkBox input,.annotationLayer .buttonWidgetAnnotation.radioButton input,.annotationLayer .choiceWidgetAnnotation select,.annotationLayer .textWidgetAnnotation input,.annotationLayer .textWidgetAnnotation textarea{background-image:var(--annotation-unfocused-field-background);border:2px solid var(--input-unfocused-border-color);box-sizing:border-box;font:calc(9px*var(--scale-factor)) sans-serif;height:100%;margin:0;vertical-align:top;width:100%}.annotationLayer .buttonWidgetAnnotation.checkBox input:required,.annotationLayer .buttonWidgetAnnotation.radioButton input:required,.annotationLayer .choiceWidgetAnnotation select:required,.annotationLayer .textWidgetAnnotation input:required,.annotationLayer .textWidgetAnnotation textarea:required{outline:1.5px solid red}.annotationLayer .choiceWidgetAnnotation select option{padding:0}.annotationLayer .buttonWidgetAnnotation.radioButton input{border-radius:50%}.annotationLayer .textWidgetAnnotation textarea{resize:none}.annotationLayer .buttonWidgetAnnotation.checkBox input[disabled],.annotationLayer .buttonWidgetAnnotation.radioButton input[disabled],.annotationLayer .choiceWidgetAnnotation select[disabled],.annotationLayer .textWidgetAnnotation input[disabled],.annotationLayer .textWidgetAnnotation textarea[disabled]{background:none;border:2px solid var(--input-disabled-border-color);cursor:not-allowed}.annotationLayer .buttonWidgetAnnotation.checkBox input:hover,.annotationLayer .buttonWidgetAnnotation.radioButton input:hover,.annotationLayer .choiceWidgetAnnotation select:hover,.annotationLayer .textWidgetAnnotation input:hover,.annotationLayer .textWidgetAnnotation textarea:hover{border:2px solid var(--input-hover-border-color)}.annotationLayer .buttonWidgetAnnotation.checkBox input:hover,.annotationLayer .choiceWidgetAnnotation select:hover,.annotationLayer .textWidgetAnnotation input:hover,.annotationLayer .textWidgetAnnotation textarea:hover{border-radius:2px}.annotationLayer .choiceWidgetAnnotation select:focus,.annotationLayer .textWidgetAnnotation input:focus,.annotationLayer .textWidgetAnnotation textarea:focus{background:none;border:2px solid var(--input-focus-border-color);border-radius:2px;outline:var(--input-focus-outline)}.annotationLayer .buttonWidgetAnnotation.checkBox :focus,.annotationLayer .buttonWidgetAnnotation.radioButton :focus{background-color:transparent;background-image:none}.annotationLayer .buttonWidgetAnnotation.checkBox :focus{border:2px solid var(--input-focus-border-color);border-radius:2px;outline:var(--input-focus-outline)}.annotationLayer .buttonWidgetAnnotation.radioButton :focus{border:2px solid var(--input-focus-border-color);outline:var(--input-focus-outline)}.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:after,.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:before,.annotationLayer .buttonWidgetAnnotation.radioButton input:checked:before{background-color:CanvasText;content:"";display:block;position:absolute}.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:after,.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:before{height:80%;left:45%;width:1px}.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:before{transform:rotate(45deg)}.annotationLayer .buttonWidgetAnnotation.checkBox input:checked:after{transform:rotate(-45deg)}.annotationLayer .buttonWidgetAnnotation.radioButton input:checked:before{border-radius:50%;height:50%;left:30%;top:20%;width:50%}.annotationLayer .textWidgetAnnotation input.comb{font-family:monospace;padding-left:2px;padding-right:0}.annotationLayer .textWidgetAnnotation input.comb:focus{width:103%}.annotationLayer .buttonWidgetAnnotation.checkBox input,.annotationLayer .buttonWidgetAnnotation.radioButton input{appearance:none}.annotationLayer .popupTriggerArea{height:100%;width:100%}.annotationLayer .popupWrapper{font-size:calc(9px*var(--scale-factor));min-width:calc(180px*var(--scale-factor));pointer-events:none;position:absolute;width:100%}.annotationLayer .popup{word-wrap:break-word;background-color:#ff9;border-radius:calc(2px*var(--scale-factor));box-shadow:0 calc(2px*var(--scale-factor)) calc(5px*var(--scale-factor)) #888;cursor:pointer;font:message-box;margin-left:calc(5px*var(--scale-factor));max-width:calc(180px*var(--scale-factor));padding:calc(6px*var(--scale-factor));pointer-events:auto;position:absolute;white-space:normal}.annotationLayer .popup>*{font-size:calc(9px*var(--scale-factor))}.annotationLayer .popup h1{display:inline-block}.annotationLayer .popupDate{display:inline-block;margin-left:calc(5px*var(--scale-factor))}.annotationLayer .popupContent{border-top:1px solid #333;margin-top:calc(2px*var(--scale-factor));padding-top:calc(2px*var(--scale-factor))}.annotationLayer .richText>*{font-size:calc(9px*var(--scale-factor));white-space:pre-wrap}.annotationLayer .caretAnnotation,.annotationLayer .circleAnnotation svg ellipse,.annotationLayer .fileAttachmentAnnotation,.annotationLayer .freeTextAnnotation,.annotationLayer .highlightAnnotation,.annotationLayer .inkAnnotation svg polyline,.annotationLayer .lineAnnotation svg line,.annotationLayer .polygonAnnotation svg polygon,.annotationLayer .polylineAnnotation svg polyline,.annotationLayer .squareAnnotation svg rect,.annotationLayer .squigglyAnnotation,.annotationLayer .stampAnnotation,.annotationLayer .strikeoutAnnotation,.annotationLayer .underlineAnnotation{cursor:pointer}.annotationLayer .annotationTextContent,.annotationLayer section svg{height:100%;position:absolute;width:100%}.annotationLayer .annotationTextContent{color:transparent;opacity:0;pointer-events:none;-webkit-user-select:none;user-select:none}.annotationLayer .annotationTextContent span{display:inline-block;width:100%}@font-face{font-display:swap;font-family:Averta Web;font-style:normal;font-weight:400;src:url(/content-platform/static/Averta-Regular-fd1297bf462e95eea6aa118597d8ef9e.otf) format("opentype")}@font-face{font-display:swap;font-family:Averta Web;font-style:italic;font-weight:400;src:url(/content-platform/static/Averta-RegularItalic-a93ae4a14814b0363207932e2c55e7bb.otf) format("opentype")}@font-face{font-display:swap;font-family:Averta Web;font-style:normal;font-weight:600;src:url(/content-platform/static/Averta-Semibold-3cbea55cef956724c095d3faa96ac883.otf) format("opentype")}@font-face{font-display:swap;font-family:Averta Web;font-style:italic;font-weight:600;src:url(/content-platform/static/Averta-SemiboldItalic-7962116f4e3c788c3df34f71cb41f4c1.otf) format("opentype")}@font-face{font-display:swap;font-family:"PT Serif";font-style:normal;font-weight:400;src:url(/content-platform/static/PT_Serif-Web-Regular-a12d02e92a52545c0e252cb52e59a199.ttf) format("truetype")}@font-face{font-display:swap;font-family:"PT Serif";font-style:italic;font-weight:400;src:url(/content-platform/static/PT_Serif-Web-Italic-fbc44e1e589cb892ee02348b2a8a348c.ttf) format("truetype")}@font-face{font-display:swap;font-family:"PT Serif";font-style:normal;font-weight:600;src:url(/content-platform/static/PT_Serif-Web-Bold-f86a6a1831027140ee56a79917cdd50d.ttf) format("truetype")}@font-face{font-display:swap;font-family:"PT Serif";font-style:italic;font-weight:600;src:url(/content-platform/static/PT_Serif-Web-BoldItalic-dc0d330f07cb434d3df2ada512eeb3b3.ttf) format("truetype")}@font-face{font-display:swap;font-family:Simplon Mono;font-style:normal;font-weight:400;src:url(/content-platform/static/SimplonMono-Regular-f7db758b4f03c8b9179c1d8fe0bb44f8.woff2) format("woff2"),url(/content-platform/static/SimplonMono-Regular-4873b89276459e0daae704dc30e2966d.woff) format("woff")}@font-face{font-display:swap;font-family:Haffer;font-style:normal;font-weight:400;src:url(/content-platform/static/HafferXH-Regular-5aabd3cd7105e25df233f608f2d66bc2.otf) format("opentype")}@font-face{font-display:swap;font-family:Haffer;font-style:italic;font-weight:400;src:url(/content-platform/static/HafferXH-RegularItalic-8cc7af3f0d75ba1b610a1b1878ea5eee.otf) format("opentype")}@font-face{font-display:swap;font-family:Haffer;font-style:normal;font-weight:500;src:url(/content-platform/static/HafferXH-Medium-dae5509349255a527ba6223b40257a7c.otf) format("opentype")}@font-face{font-display:swap;font-family:Haffer;font-style:normal;font-weight:600;src:url(/content-platform/static/HafferXH-SemiBold-64a01291b8f7380359bb3642c1b1e00a.otf) format("opentype")}@font-face{font-display:swap;font-family:Haffer;font-style:italic;font-weight:600;src:url(/content-platform/static/HafferXH-SemiBoldItalic-869dd4deb4c6e290c1aaf1e6a8670036.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:100;src:url(/content-platform/static/VCNudge-Thin-09f2315fb254f9dc017f0e4983166415.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:300;src:url(/content-platform/static/VCNudge-Light-dc44d09f0564da3a5f46801b8bb26cd8.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:400;src:url(/content-platform/static/VCNudge-Regular-be0a147c918c6bec670c17f5204784bb.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:700;src:url(/content-platform/static/VCNudge-Bold-822d17e33e72d439ad42d99a75ae6df0.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:800;src:url(/content-platform/static/VCNudge-ExtraBold-a2d0723b460f32bc659ad1670a00ae22.otf) format("opentype")}@font-face{font-display:swap;font-family:Nudge;font-style:normal;font-weight:900;src:url(/content-platform/static/VCNudge-Black-9e870be920be60c228f9a4affa885f8d.otf) format("opentype")}@font-face{font-display:swap;font-family:Para;font-style:normal;font-weight:300;src:url(/content-platform/static/Para-Central-Light-b0a58901815efc51b2b07b595eca45f7.otf) format("opentype")}@font-face{font-display:swap;font-family:Para;font-style:italic;font-weight:300;src:url(/content-platform/static/Para-Central-Light-Italic-48e4a958a048c612c6a0927f538018b8.otf) format("opentype")}@font-face{font-display:swap;font-family:Para;font-style:normal;font-weight:400;src:url(/content-platform/static/Para-Central-Regular-03a3a49a91a9bbf991dd6263feab3975.otf) format("opentype")}@font-face{font-display:swap;font-family:Para;font-style:normal;font-weight:700;src:url(/content-platform/static/Para-Central-Bold-3107caa8a871d45bb00cb084bcc8ffc1.otf) format("opentype")}@font-face{font-display:swap;font-family:DM Mono;font-style:normal;font-weight:300;src:url(/content-platform/static/DMMono-Light-2cf6d0b2de012ff294ce86eecb4263e5.ttf) format("truetype")}@font-face{font-display:swap;font-family:DM Mono;font-style:italic;font-weight:300;src:url(/content-platform/static/DMMono-LightItalic-0e20bf0432fcf702ef0306184759a593.ttf) format("truetype")}@font-face{font-display:swap;font-family:DM Mono;font-style:normal;font-weight:400;src:url(/content-platform/static/DMMono-Regular-15edd89a6460acfb1a86017399e47a1f.ttf) format("truetype")}@font-face{font-display:swap;font-family:DM Mono;font-style:italic;font-weight:400;src:url(/content-platform/static/DMMono-Italic-6b7b77e96ef2aa8ec8fffe2e28239719.ttf) format("truetype")}@font-face{font-display:swap;font-family:DM Mono;font-style:normal;font-weight:500;src:url(/content-platform/static/DMMono-Medium-50d7af0bb966bc0570a212128d7ab24d.ttf) format("truetype")}@font-face{font-display:swap;font-family:DM Mono;font-style:italic;font-weight:500;src:url(/content-platform/static/DMMono-MediumItalic-85bff8703124566bb1a660afda35365b.ttf) format("truetype")}body,html{box-sizing:border-box;margin:0;padding:0}code[class*=language-],pre[class*=language-]{word-wrap:normal;background:none;color:#000;font-family:Consolas,Monaco,Andale Mono,Ubuntu Mono,monospace;font-size:1em;-webkit-hyphens:none;hyphens:none;line-height:1.5;tab-size:4;text-align:left;text-shadow:0 1px #fff;white-space:pre;word-break:normal;word-spacing:normal}code[class*=language-] ::selection,code[class*=language-]::selection,pre[class*=language-] ::selection,pre[class*=language-]::selection{background:#b3d4fc;text-shadow:none}@media print{code[class*=language-],pre[class*=language-]{text-shadow:none}}pre[class*=language-]{margin:.5em 0;overflow:auto;padding:1em}:not(pre)>code[class*=language-],pre[class*=language-]{background:#f5f2f0}:not(pre)>code[class*=language-]{border-radius:.3em;padding:.1em;white-space:normal}.token.cdata,.token.comment,.token.doctype,.token.prolog{color:#708090}.token.punctuation{color:#999}.token.namespace{opacity:.7}.token.boolean,.token.constant,.token.deleted,.token.number,.token.property,.token.symbol,.token.tag{color:#905}.token.attr-name,.token.builtin,.token.char,.token.inserted,.token.selector,.token.string{color:#690}.language-css .token.string,.style .token.string,.token.entity,.token.operator,.token.url{background:hsla(0,0%,100%,.5);color:#9a6e3a}.token.atrule,.token.attr-value,.token.keyword{color:#07a}.token.class-name,.token.function{color:#dd4a68}.token.important,.token.regex,.token.variable{color:#e90}.token.bold,.token.important{font-weight:700}.token.italic{font-style:italic}.token.entity{cursor:help}
What Is Accelerated Depreciation? | GoCardless Skip to content
What is accelerated depreciation?
Written by GoCardless The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless.
The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each.
The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio Last editedOct 2020 — 2 min read
Accelerated depreciation definition Accelerated depreciation methods Are there accelerated depreciation tax benefits? We can help When an asset is new and at its most efficient, a company uses it the most. This is the guiding principle behind the accelerated depreciation method used in accounting for tax purposes. Here’s a closer look at how accelerated depreciation is calculated and when it might be beneficial.
Accelerated depreciation definition Accelerated depreciation is a method used to calculate asset value over time. It’s based on the principle that an asset’s value is highest at the beginning of its lifespan, allowing for more significant depreciation in value during these first few years. Several different methods are used to work out the accelerated depreciation calculation. The two main options include:
We’ll explore these in greater detail below.
Accelerated depreciation vs. straight-line depreciation An asset’s value follows a steady trajectory over time in a straight-line depreciation method. With accelerated depreciation, the asset depreciates in cost more during the early years of its lifespan, with a slower depreciation rate later. No matter the method of depreciation , all assets should end up with the same final amount of depreciation. The main difference between accelerated depreciation vs. straight-line depreciation is timing.
Accelerated depreciation methods To calculate accelerated depreciation, you can use a few different methods. Here’s a little more information about the Sum of the Years’ Digits method and the Double Declining Balance method:
Sum of the years’ digits (SYD) The formula used in SYD calculations is as follows:
Sum of the Years’ Digits Depreciation = Depreciable Cost x (Remaining Useful Life / Sum of Years’ Digits)
You can calculate the Sum of the Years’ Digits like so:
Sum of the Years’ Digits = (Useful Life x (Useful Life + 1)) / 2
Double declining balance method With the double declining balance method, the formula is as follows:
Double Declining Depreciation = 2 x Straight-Line Depreciation Rate x Value at Beginning of the Year
As you can see, for the double declining balance method to work, you’ll need to know how to calculate the straight-line depreciation rate. You can use the following formula to do so:
Straight-Line Depreciation = (Purchase Price – Salvage Value) / Useful Life
Are there accelerated depreciation tax benefits? In the short term, there can be income tax benefits to using this method. While the straight-line method calculates depreciation evenly over time, businesses can deduct higher expenses during the first few years of an asset’s lifespan using the accelerated depreciation method. The expenses are then lowered as the asset is used less later in its lifespan.
For example, according to US income tax regulations, a business must use straight-line depreciation on financial statements but is able to use accelerated depreciation on income tax returns. This means that the company could deduct higher expenses on the income tax return.
At the same time, the depreciation of your company’s assets has an impact on profits. During the earlier years of an asset’s lifespan, the company would report a lower profit due to the financial loss associated with its acquisition. Then, in later years, the asset is likely to show a lower rate of depreciation, with a higher reported profit. As a result, it’s a potentially useful accounting concept for any business owner to be aware of.
We can help GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments .
Over 100,000 businesses use GoCardless to get paid on time. Learn more about how you can improve payment processing at your business today.
All Categories Interested in automating the way you get paid? GoCardless can help Contact us Seen 'GoCardless Ltd' on your bank statement? Learn more
GoCardless Inc., 111 Congress Avenue, Suite 500, Austin, TX 78701
GoCardless Inc. (a Delaware Corporation, NMLS ID 2123932), is a FinCEN-registered money services business, registration number 31000261158426, and a licensed money transmitter in certain U.S. states.
Try a better way to collect payments
Try a better way to collect payments