Depreciation is a non-cash deduction — money you keep without spending anything in the year. Yet businesses routinely underclaim it through sloppy asset records.

How tax depreciation works

Assets are grouped into blocks with notified rates, and depreciation applies to the block’s written-down value. Assets used for less than half the year get a reduced claim as per the rules; certain new plant and machinery has enjoyed additional depreciation where conditions are met.

Where claims leak

  • Expensed assets: equipment booked as expenses vanish from the depreciation schedule (sometimes fine, sometimes wasteful — it is a choice to make deliberately)
  • Missing put-to-use dates: late documentation pushes claims to the next year
  • Forgotten assets: renovations, electrical work and software often qualify and never get listed
  • Wrong blocks: misclassification changes the rate

The fix

Maintain a live fixed-asset register: purchase date, put-to-use date, block, rate. Ten minutes per purchase, real money each year.

Asset registers and optimised claims are standard in our accounting service — talk to us.