Tax Allowances in Depreciation

[former_member220526]

Hi Experts,

I Have a scenario. in company code country we have two types of depreciation. 1) Book Depreciation and 2) Tax Depreciation. Tax depreciation is only for reporting purpose hence it is not posted in G/L after depreciation run executed. To handle this i have created two depreciation areas 01 & 02 Respectively. Book Depreciation is working absolutely fine but we are having issues in Tax Depreciation. Following is the scenario:

Tax Depreciation is to be charged on a particular asset at 15% in the first year and then 10% in the remaining years until the life of asset. For this i have done following settings in multilevel depreciation

Acc Year     Year     Prd     Base Value     Percentage      Remaining Life    

9999            01                  24                  15              

9999            999                24                  10

The issue here is that system keeps calculating depreciation on 15% and does not change the rate in subsequent years. Basically this 15% is initial allowance provided by tax authorities. can any one share their experience in handling this or what i need to do in order to make above multilevel settings work.

Regards,

[Former Member]

Hi Faizan,

Please find the depreciation key assigned to the tax depreciation area in the asset master.

Then check the depreciation key settings as to whether the configuration meets your requirement.