Depreciation is a central concept in business accounting and also plays an important role in fleet management . It describes the loss in value of vehicles over time and has a direct impact on a company’s accounting, tax burden and investment planning.
What does amortization mean?
Depreciation – also known as depreciation for wear and tear – refers to the distribution of the acquisition costs of a vehicle over its useful life. This means that the annual depreciation is recognized in the balance sheet and for tax purposes.
Example: If a vehicle is purchased for €40,000 and used for 6 years, the straight-line depreciation amounts to €6,666.67 per year.
Depreciation types for vehicles
Two main depreciation models are common in the vehicle fleet :
- Straight-line depreciation. The acquisition value is distributed evenly over the normal useful life (e.g. 6 years for cars).
- Degressive Abschreibung. Höherer Abschreibungsbetrag in den ersten Jahren, fallend in den Folgejahren. Diese Methode ist steuerlich nicht immer zulässig und war zuletzt nur befristet erlaubt.
Legal basis
Vehicles are depreciated in accordance with the Income Tax Act (§ 7 Para. 1) and are based on the useful lives specified by the tax authorities – in most cases:
- Car: 6 year
- Truck: 9 years
- Electric vehicles: also 6 years, with special depreciation if applicable
Influence on fleet management
- Cost planning: Depreciation allows costs to be calculated annually and planned into budgets.
- Investment decisions: The residual book value of a vehicle plays an important role in replacement purchases.
- Tax optimization: Depreciation reduces the taxable profit.
- Balance sheet clarity: The presentation of the actual vehicle value improves transparency.
Special features of leased vehicles
As a rule, leased vehicles do not belong to the company. In this case, no traditional depreciation is applied, but the lease payments are recognized as
Conclusion
Depreciation is an indispensable tool in fleet controlling. It enables a realistic assessment of vehicle values, supports the planning of replacement investments and optimizes the tax burden. If you keep an overview of depreciation in your fleet, you can make more informed economic decisions.
