NZ Rental Chattels Depreciation Calculator

This calculator works out how much depreciation you can claim each year on the chattels inside a rental property, now that residential and commercial buildings sit at a 0% depreciation rate. Chattels are the separable items inside a rental, carpet, curtains, heat pumps, hot water cylinders, ovens, dishwashers, washing machines and furniture among them, and IRD still lets you depreciate these even though the building itself no longer qualifies. You choose a chattel type from 16 common categories, each carrying its own IRD diminishing value and straight-line rate, enter the purchase cost, pick your depreciation method, set how many years to project, and select your marginal tax rate so the tool can estimate the tax saved. If the cost is $1,000 or less, the calculator applies the low-value asset write-off automatically and expenses the full amount in year one instead of building a schedule. Otherwise it returns a year-by-year table showing the opening book value, the depreciation claimed, the closing book value and the tax saved for each year, plus running totals once the asset is fully written down. Use it to budget your rental deductions, compare how diminishing value front-loads claims against the even spread of straight-line, or check whether a smaller item qualifies for immediate expensing. Figures are based on IRD's general depreciation determination and are indicative only, your accountant should confirm treatment for your specific return.

Updated  IRD DET 05/01 rates. Buildings 0% from 2024/25. Low-value threshold $1,000.
Calculate.co.nz is proud to be partnered with realtor.co.nz, a trusted resource for navigating the New Zealand property market. Their Helpful Articles section offers clear, well-structured insights across buying, selling, and building, making complex real estate topics more accessible. With a focus on up-to-date guidance and practical knowledge, they empower Kiwis to move forward with clarity and confidence in a constantly evolving property landscape.
Calculate.co.nz partner: realtor.co.nz
Advertise on this page

Chattel

$
If cost is $1,000 or less, it can be immediately expensed (low-value asset write-off).

Rates used in this calculator

From IRD DET 05/01 (General Depreciation Rate Determinations for the residential rental buildings industry):

ChattelDV rateSL rateEstimated useful life

Building depreciation is 0%

From the 2024/25 income year, all buildings (residential and commercial) have a 0% depreciation rate. This was a significant change in Budget 2024. Previously, commercial buildings had 2% restored (2020-2024), and residential had been 0% since 2011. If you own a rental with existing building depreciation claimed in prior years, there's no further depreciation from the 2024/25 year onwards, but your book value doesn't change either.

Low-value asset write-off

Individual assets costing $1,000 or less (GST-exclusive) can be immediately expensed rather than depreciated. For a new rental fit-out, this often means smoke alarms, light fittings, small kitchen items, and bedroom furniture get written off on day one, while larger items (carpet, heat pump, hot water cylinder, appliances) get depreciated over their useful life.

Sources

Related calculators

Related calculators

Frequently asked questions

Can I still depreciate my rental building?

No. Building depreciation is 0% for all buildings (residential and commercial) from the 2024/25 income year onwards. Previously, commercial buildings had a 2% depreciation rate restored between 2020 and 2024 as a Covid recovery measure, but that was removed in Budget 2024. Residential buildings have had 0% since 2011. You CAN still depreciate items that are not part of the building itself - chattels like carpet, curtains, appliances, heat pumps, hot water cylinders, and furniture.

What's the difference between diminishing value and straight-line?

Diminishing value (DV) applies the rate to the current book value each year, so depreciation is highest in year 1 and decreases over time. Straight-line (SL) applies a lower rate to the original cost, producing equal deductions each year. DV fronts the tax benefit (better if your marginal rate is high now); SL spreads it evenly. You choose the method when you first depreciate an asset and cannot switch for that asset. DV rates are typically about 1.5x the SL rate for the same asset life.

What is the low-value asset threshold?

Assets costing $1,000 or less (GST-exclusive) can be written off immediately in the year of purchase rather than depreciated over time. This threshold was temporarily raised to $5,000 during 2020-2021 as a Covid measure but reverted to $1,000 from 17 March 2021 onwards. The threshold applies per asset, so you can immediately expense multiple individual items as long as each is $1,000 or less. This is useful for smaller chattels like smoke alarms, individual kitchen appliances, or furniture pieces.

What counts as a chattel vs part of the building?

IRD distinguishes between items that are permanently part of the building (walls, roof, plumbing, electrical wiring - building and not depreciable) and items that are separable chattels (carpet laid over floors, freestanding appliances, removable heat pumps, furniture - depreciable). Hot water cylinders are chattels even though plumbed in. Heat pumps are chattels. Carpet is chattel even though fixed to the floor. If in doubt, ask: could this be removed and replaced without structural work? If yes, it's likely a chattel.

Do I have to depreciate chattels or can I skip it?

Technically, depreciation is mandatory - you're deemed to have claimed it whether you actually did or not. If you don't claim it now, you lose the deduction, but on sale you still have to recapture (add back as income) any depreciation recovered on chattels sold for more than book value. Most rental investors claim chattels depreciation because it creates legitimate current-year deductions - typically $2,000-$5,000 per year for a standard rental property.