{"id":4943,"date":"2026-07-20T09:00:00","date_gmt":"2026-07-20T07:00:00","guid":{"rendered":"https:\/\/inventory-one.com\/?p=4943"},"modified":"2026-07-17T08:39:31","modified_gmt":"2026-07-17T06:39:31","slug":"depreciation","status":"publish","type":"post","link":"https:\/\/inventory-one.com\/en\/2026\/07\/20\/abschreibung\/","title":{"rendered":"Depreciation (AfA): Definition, Methods, and Examples"},"content":{"rendered":"<p>The <strong>Depreciation<\/strong> \u2013 for tax purposes <strong>Depreciation (AfA)<\/strong> \u2013 allocates the acquisition cost of an asset over its useful life. This way, investments do not reduce profits all at once, but rather year by year. This article explains the definition and methods (straight-line, declining-balance, and units-of-production) and provides examples.<\/p>\n<h2>Key Points at a Glance<\/h2>\n<ul>\n<li>Depreciation (AfA) allocates the acquisition cost over the asset's normal useful life.<\/li>\n<li>The legal basis is <strong>\u00a7 7 of the Income Tax Act (EStG)<\/strong>.<\/li>\n<li>Key Methods: <strong>linear<\/strong> and <strong>degressive<\/strong> Depreciation and amortization.<\/li>\n<li>The <strong>declining-balance depreciation<\/strong> is once again possible through the \u201eInvestment Booster\u201c for purchases made from July 1, 2025, through December 31, 2027 (up to 3\u00d7 linear, max. 30 %).<\/li>\n<li>The useful life is determined by the <strong>Depreciation Tables<\/strong> of the Federal Ministry of Finance.<\/li>\n<\/ul>\n<h2>What is depreciation (AfA)?<\/h2>\n<p>Fixed assets lose value over time. The <strong>Depreciation<\/strong> reflects this loss in value for accounting purposes: Instead of recognizing the full acquisition or production costs as an expense immediately, they are amortized over the <strong>Useful life<\/strong> distributed. In tax terms, this is referred to as the <strong>Depreciation (AfA)<\/strong> pursuant to Section 7 of the Income Tax Act (EStG).<\/p>\n<h2>An Overview of Depreciation Methods<\/h2>\n<h3>Straight-line depreciation<\/h3>\n<p>The <strong>straight-line depreciation<\/strong> Distributes costs evenly: The same amount is depreciated each year\u2014the acquisition cost divided by the useful life. This is the standard method and is always permissible.<\/p>\n<h3>Declining-Balance Depreciation<\/h3>\n<p>In the <strong>declining-balance depreciation<\/strong> A fixed percentage of the respective remaining book value is depreciated\u2014the amounts are high at the beginning and decrease over time. Over the <strong>Investment Booster<\/strong> It applies to movable assets that are transferred between the <strong>July 1, 2025, and December 31, 2027<\/strong> purchased again: by <strong>Three times the linear depreciation rate, up to a maximum of 30 %<\/strong>. It is advisable to switch to the linear method in a good year.<\/p>\n<h3>Amortization of Services<\/h3>\n<p>The <strong>Depreciation Based on Output<\/strong> Calculates depreciation based on actual use (e.g., kilometers driven or operating hours). This method is useful when wear and tear varies significantly.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/inventory-one.com\/wp-content\/uploads\/2026\/07\/infografik-afa-methoden.png\" alt=\"An Overview of Depreciation Methods: A Comparison of Straight-Line, Declining-Balance, and Unit-of-Production Depreciation\" \/><figcaption class=\"wp-element-caption\">An Overview of the Three Depreciation Methods.<\/figcaption><\/figure>\n<h2>Useful Life and Depreciation Schedule<\/h2>\n<p>The duration of the depreciation period depends on the <strong>normal useful life<\/strong>. You can find this information in the <strong>Depreciation Tables<\/strong> from the Federal Ministry of Finance. For more details, see our article on the depreciation table.<\/p>\n<h2>Special Case: Low-Value Assets<\/h2>\n<p>Assets with a net value of up to \u20ac800 may be fully depreciated immediately. For more information, see our article on low-value assets (GWG).<\/p>\n<h2>Example: Linear vs. Declining<\/h2>\n<p>A machine costs \u20ac10,000 net and has a useful life of 5 years. <strong>Linear<\/strong> \u20ac2,000 is depreciated annually. <strong>Decreasing<\/strong> (30 %) The amount is \u20ac3,000 in the first year and \u20ac2,100 in the second\u2014so it\u2019s significantly higher at the start. You can calculate both step by step in our article on depreciation calculations.<\/p>\n<h2>Accurately Tracking Assets\u2014The Foundation of Depreciation<\/h2>\n<p>Any depreciation calculation requires that you know which assets you own, how much they cost, and when they were purchased. This is exactly what a well-maintained fixed asset or inventory list provides. With <a href=\"https:\/\/inventory-one.com\/en\/inventory-management\/\">Inventory ONE<\/a> Record each fixed asset using <strong>Cost, Date, and Useful Life<\/strong> via scan\u2014the perfect basis for your depreciation. Learn more on our pages about <a href=\"https:\/\/inventory-one.com\/en\/inventory-management\/\">Inventory Management Software<\/a> and to the <a href=\"https:\/\/inventory-one.com\/en\/inventory-system\/\">Inventory system<\/a>.<\/p>\n<h2>Frequently Asked Questions About Depreciation (FAQ)<\/h2>\n<h3>What does depreciation (AfA) mean?<\/h3>\n<p>The allocation of the acquisition or production cost of an asset over its useful life; tax deduction for depreciation under Section 7 of the Income Tax Act (EStG).<\/p>\n<h3>What depreciation methods are there?<\/h3>\n<p>In particular, straight-line and declining-balance depreciation, as well as usage-based depreciation. For low-value assets, there is also immediate write-off.<\/p>\n<h3>Will declining-balance depreciation be possible in 2026?<\/h3>\n<p>Yes. For tangible assets acquired between July 1, 2025, and December 31, 2027, declining-balance depreciation of up to 3\u00d7 the straight-line depreciation rate, with a maximum of 30 %, is permitted.<\/p>\n<h3>What determines the useful life?<\/h3>\n<p>Based on the standard useful life specified in the depreciation tables of the Federal Ministry of Finance.<\/p>\n<p><em>This article is intended for general informational purposes only and is not a substitute for tax advice. The regulations mentioned are current as of 2026; the applicable tax regulations in effect at any given time shall prevail. Please consult your tax advisor regarding your specific situation.<\/em><\/p>\n<p><!--AFA-NAV--><\/p>\n<h2>More Articles on Depreciation &amp; Fixed Assets<\/h2>\n<ul>\n<li><strong>Depreciation (AfA) \u2013 Basics &amp; Methods<\/strong> (this article)<\/li>\n<li><a href=\"https:\/\/inventory-one.com\/en\/?p=4944\">Depreciation Schedule \u2013 Find the Useful Life<\/a><\/li>\n<li><a href=\"https:\/\/inventory-one.com\/en\/?p=4945\">Calculate Depreciation \u2013 Calculator &amp; Examples<\/a><\/li>\n<li><a href=\"https:\/\/inventory-one.com\/en\/?p=4879\">Low-Value Assets (LVA)<\/a><\/li>\n<li><a href=\"https:\/\/inventory-one.com\/en\/?p=4881\">Maintain an asset register<\/a><\/li>\n<\/ul>","protected":false},"excerpt":{"rendered":"<p>Depreciation (AfA) Explained Simply: Definition, Straight-Line and Declining-Balance Methods, Output-Based Depreciation, Useful Life, and Examples\u2014including Declining-Balance Depreciation for 2025\u20132027.<\/p>","protected":false},"author":6,"featured_media":4955,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[],"class_list":["post-4943","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buchhaltung-anlagen"],"acf":[],"_links":{"self":[{"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/posts\/4943","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/comments?post=4943"}],"version-history":[{"count":2,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/posts\/4943\/revisions"}],"predecessor-version":[{"id":4952,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/posts\/4943\/revisions\/4952"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/media\/4955"}],"wp:attachment":[{"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/media?parent=4943"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/categories?post=4943"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/inventory-one.com\/en\/wp-json\/wp\/v2\/tags?post=4943"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}