IRD Depreciation Rate Finder NZ 2026-27
This tool helps you find the exact Inland Revenue depreciation rate for any business or rental asset, then work out what that rate is worth in dollars. Start by typing an asset name or keyword, such as laptop, ute, heat pump or carpet, into the search box, and the table below returns matching entries from the IRD depreciation schedule, showing the diminishing value (DV) rate, the straight-line (SL) rate, the estimated useful life and the IRD category for each asset. Click any row to send its DV rate straight into the calculator further down the page, or type your own rate by hand. There, enter the asset cost, the depreciation rate, the number of years to project and your chosen method, and the tool builds a year-by-year schedule showing the opening value, the annual depreciation, the indicative tax saving at the 28 percent company rate, and the closing book value for each year. Use it to check the correct rate before filing, to compare how much faster DV depreciates an asset than SL, or to see how many years it takes to depreciate down to nothing. Rates come from IRD's published determinations and are current for the 2026-27 income year, but always confirm the rate for unusual or newly introduced assets at ird.govt.nz or with your accountant, and treat the tax saving figures as an indicative estimate only.
| Asset | DV Rate | SL Rate | Est. Life | IRD Category |
|---|
| Year | Opening Value ($) | Depreciation ($) | Tax Saving @ 28% ($) | Closing Value ($) |
|---|
Tax saving is indicative at 28% (company rate). Sole traders and partnerships use their marginal rate. This is a general estimate and not tax advice.
How to use this tool
Type any asset name or keyword into the search box. Results update as you type, matching against asset names and common search terms. The table shows the DV rate (applied to the declining book value each year) and the SL rate (applied to the original cost each year). Click any row to send that asset's DV rate straight into the depreciation calculator below, or type your own rate.
DV versus SL: which should I use?
The diminishing value method gives you larger deductions in the earlier years because the rate is applied to the remaining book value, which shrinks each year. The straight-line method spreads equal deductions across each year because the rate is applied to the original cost. Most New Zealand businesses choose DV because the earlier tax deductions improve cash flow. You can switch from DV to SL at any time, but once you start on SL you cannot switch back to DV for that asset.
Key rules to know
- Low-value asset threshold. Assets costing $1,000 or less (excluding GST, for GST-registered businesses) can be written off in full in the year of purchase rather than depreciated over time.
- Buildings. Residential rental buildings have had a 0% depreciation rate since the 2011 income year. Commercial buildings lost depreciation again from 1 April 2024. Fit-out within a building and chattels within a rental property remain depreciable at the rates shown in the search results above.
- Investment Boost scheme. From 22 May 2025, businesses can claim an additional 20% upfront deduction on new qualifying assets in the year of purchase, on top of the normal first-year depreciation. The standard DV or SL rate then applies to the remaining value from year two onwards.
- Half-year rule (SL method). In the first and last year of ownership, only half the annual SL rate applies if the asset is not held for the full year.
- Special rate applications. If no published rate matches your asset, you can apply to IRD for a special depreciation rate using form IR260B.
Worked example
Laptop, $3,000 cost, DV method at 50% per year.
Year 1: $3,000 opening value x 50% = $1,500 depreciation. Closing value $1,500.
Year 2: $1,500 x 50% = $750 depreciation. Closing value $750.
Year 3: $750 x 50% = $375 depreciation. Closing value $375.
Total deducted over 3 years: $2,625. At a 28% company tax rate, that is $735 of tax saved.
Same laptop, SL method at 40% per year.
Year 1: $3,000 x 40% = $1,200 depreciation (equal each year). Closing value $1,800.
Year 2: $3,000 x 40% = $1,200 depreciation. Closing value $600.
The asset is fully depreciated after 2.5 years under SL, so the deduction stops when the book value reaches zero.
About the IRD depreciation schedule
Inland Revenue sets depreciation rates by estimating the useful life of each asset type and applying a formula. The DV rate is approximately 1.5 divided by the useful life (in years), and the SL rate is 1 divided by the useful life. Rates are set out in Determinations starting with DEP1 (the general schedule) and extending to special determinations for specific industries or asset types, such as DEP80 (residential rental property chattels) and DEP87 (tablets and smartphones). The rates in this tool are sourced from those determinations as at the 2026-27 income year.
Frequently asked questions
What is the difference between DV and SL depreciation methods in NZ?
DV (Diminishing Value) applies the percentage to the remaining book value each year, giving larger deductions early on. SL (Straight Line) applies the percentage to the original cost, giving equal deductions each year. Most businesses choose DV for a faster initial tax deduction.
Can I change depreciation method once I have started?
Yes, you can switch from DV to SL at any time, but you cannot switch from SL to DV. The switch is made in the year you change, and you carry on applying the new method to the remaining book value.
Where does IRD publish the full depreciation rate schedule?
IRD publishes the General Depreciation Rates schedule at ird.govt.nz. The schedule is in Determination DEP1 through DEP100 and beyond, and is updated periodically when new asset types or industries are added.
Official sources
- Inland Revenue: Depreciation rates
- Inland Revenue: Low-value assets
- Inland Revenue: Investment Boost scheme
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