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author's profile photo Former Member
Former Member

Tax Depreciation

Hi

What is the difference between Oridinary Depreciation and Book Depreciation

why Tax depreciation is calculated and where it is used

Thanks in advance

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3 Answers

  • Best Answer
    Posted on Oct 28, 2008 at 11:27 PM

    both of these answers look correct to me.

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  • author's profile photo Former Member
    Former Member
    Posted on Oct 23, 2008 at 10:31 AM

    When you have to report depreciaton based on your own cost rules and tax rules you can have different depreciation areas to calcululate this by asset.

    In our system we have by asset class from 2 to 8 depreciation area's, like

    LO books

    US books

    US books in USD

    LO books index based

    Tax based

    Inflation.

    First found out the requerement from you company and have a look in SAP to the template from your country

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  • author's profile photo Former Member
    Former Member
    Posted on Oct 23, 2008 at 02:51 PM

    Book and tax depreciation are diff depreciation areas which calculates depreciation based on diff. reporting std. Book depreciation calculates based on ur local reporting std which might have diff. useful lifes and deprec method and tax deprec calculates based on ur tax reporting which can have different useful life and deprec rates. If your company is managing parallel currencies than you will have couple of more deprec areas based on it.

    hope this helps.

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