Depreciable property: definition, requirements and features

Depreciable property is recognized as property, products of intellectual labor owned by the economic entity and used by it to generate income. At the same time, the useful life of such facilities should be at least 12 months. The initial cost of depreciable property should be more than 10 thousand rubles. Its repayment is carried out through depreciation.

Exceptions

Not every property that meets the above requirements will be considered depreciable. Exceptions, in particular, are recognized:

1. Land, other natural objects (subsoil, water, etc.).
2. Securities.
3. Inventories.
4. Objects under construction.
5. Goods.
6. Financial instruments (including futures, options, forward contracts).

Depreciable property not subject to depreciation

This group includes:

1. Material values ​​of budget organizations. The exception here is property acquired in the course of doing business and operated for its implementation.
2. Values ​​of non-profit organizations that are received in the form of earmarked income or purchased with earmarked funds and are used to conduct core non-profit activities.
3. Values ​​acquired on budgetary funds. An exception is property received by the entity during privatization.
4. Objects of improvement, forestry, road facilities, the creation of which was carried out with the involvement of budgetary or other similar targeted financing, specialized structures for shipping purposes and other similar objects.
5. Acquired publications (brochures, books, etc.), works of art. The cost of such objects (except for works of art) refers to other expenses associated with the production and sale of products at the time of acquisition in full.
6. Water buffalo, livestock, deer, oxen, yak and other domesticated animals, except for livestock.
7. Acquired rights to products of intellectual labor or other intellectual property, if, under a contract of sale, payment must be made periodically during the period of its validity.
   

Additionally

Assets are also excluded from depreciable assets:

1. Translated for conservation, lasting more than three months.
2. Received / transferred under a gratuitous use agreement.
3. Being on modernization / reconstruction, lasting more than 12 months.

When depreciable property is depreciated in accounting, depreciation is accrued in the manner that existed prior to conservation, and the useful life is increased by its duration.

The initial price of an asset is defined as the sum of the costs of its acquisition and bringing it into a state of readiness for operation.

Depreciable Property Groups

They are formed depending on the useful life of the objects.

An economic entity may, at its discretion, extend the period after the date of commissioning, if modernization, reconstruction, technical re-equipment (re-equipment) has led to an increase in the service life of the asset.

For convenience, groups of objects are shown in the table.

The classification of fixed assets included in groups is approved by the Government.

Overview of Depreciation

Calculation of depreciation of depreciable property, in accordance with Art. 25 Tax Code, is produced by a linear or non-linear method.

The business entity determines the amount of depreciation for tax purposes separately for each asset on a monthly basis. Charging begins on the 1st of the month that follows the month of putting the facility into operation. Calculation also ceases from the 1st day of the month following the month of writing off the fixed asset or disposal of depreciated property on any basis.

Nuances

For depreciated property included in groups 8–10, regardless of the term of putting it into operation, accruals are made using the linear method. To other objects, an economic entity can apply either of two methods.

Please note that the selected method cannot be changed throughout the depreciation calculation period.

Accrual Features

When using the linear method, the depreciation amount is defined as the product of the initial cost of fixed assets and depreciation rates. The latter is calculated as follows:

K = [1 / n] x 100%.

In this formula:

• depreciation rate in% of the initial cost - K;
• the useful life of the facility, expressed in months, is n.

If the non-linear method is used, then the desired value is determined by multiplying the residual value of the depreciable property by the norm:

K = [2 / n] x 100%.

Important points

When calculating, it is necessary to take into account that from the month following the month in which the residual value of depreciated property reaches 20% of the original, accrual should be made according to the following rules:

1. The residual value is recognized as the base.
2. The depreciation amount per month is calculated by dividing the base amount by the number of months remaining until the end of the useful life.

Odds

They are used in calculating the depreciation of depreciated property operated in aggressive conditions or with increased shift. The coefficients can also be used by agricultural enterprises: greenhouses, poultry farms, livestock farms, etc. However, some restrictions are set.

In particular, a ratio of no higher than 2 can be applied to these entities. For fixed assets that are the subject of a leasing agreement, it is allowed to use a coefficient of no higher than three in the calculation.

These provisions do not apply to an object included in groups 1-3, if the non-linear method is used.

Aggressive are artificial or natural factors, the influence of which causes increased wear of the OS. The presence of property in contact with a fire, explosive, toxic or other aggressive environment, which is the source (cause) of the emergency, is also equivalent to functioning under such conditions.

When calculating the depreciation amounts for passenger vans and cars, the initial cost of which is more than 400 thousand rubles. and 300 thousand rubles. accordingly, a coefficient of 0.5 is applied to the basic norm.

By decision of the head of the enterprise, depreciation may be charged at lower rates, but only from the beginning of the tax period and throughout.

Taxation

According to the OS put into operation before the introduction of Ch. 25 of the Tax Code, the useful life of the business is determined by the business entity as of 01.01.2002, taking into account the classification approved by the Government and the periods of operation of the groups fixed by Art. 258 of the Code.

Regardless of the accrual method chosen by the taxpayer in relation to depreciated property put into operation before the entry into force of Ch. 25, the calculation is based on the residual value.

Analytical accounting

It should reflect information about:

1. The initial value of the object that was disposed of in the tax (reporting) period, as well as about its changes during the retrofitting, completion, partial liquidation, reconstruction.
2. Useful lives accepted by the enterprise.
3. Accrual methods and depreciation amounts from the beginning of the calculation to the end of the month in which the sale (disposal) of the object took place.
4. The cost of the sale of property, in accordance with the contract.
5. The date of acquisition and sale (disposal) of fixed assets, its transfer to operation, exclusion from depreciable objects on the grounds specified in paragraph 3 of Art. 256 Tax Code, re-mothballed an asset, termination of a contract for gratuitous use, completion of modernization and reconstruction.
6. Costs incurred by the entity upon disposal of property. It is, in particular, about the costs provided for by sub. 8 p. 1 art. 265 Tax Code, as well as the costs of storage, transportation and maintenance of the asset.

The profit received by the business entity is included in the tax base in the reporting period in which the sale is made. Losses incurred by the taxpayer are reflected in the account as other expenses, in accordance with the rules enshrined in Art. 268 Tax Code.

Analytical accounting should include information on the name of the assets for which the amounts of the corresponding costs are recorded, the number of months during which they will be allocated to other expenses, as well as the amount of monthly costs.