Dynamics Community Forum Thread Details

Tax Depreciation Calculation

Hi everyone,

Currently supporting a client with tax depreciation setup. The depreciation method required by tax law is Proportional, and the calculation is based on this formula:(Purchase value × Number of days in use) / 365The depreciation must begin from the actual acquisition date, not the beginning of the month or fiscal year. Also, the formula must take into account 366 days for leap years.Here’s a concrete example:

Acquisition date: 19/08/2022
Purchase value: 169,615.69
Accounting depreciation by 31/12/2022: 18,739.79
Tax depreciation per Excel/manual calculation: 18,680.96

I've tried everything I could think of:

All available depreciation methods (straight-line)
Different depreciation conventions (including "None")
Fiscal calendars with daily periods
Different setups in value models and depreciation profiles

Despite all this, I cannot get D365 to calculate the depreciation value exactly as per the tax formula , especially with daily precision and handling of leap years.I do understand customization may be needed, but I’m unsure where exactly it should be applied, is it in the depreciation engine itself, a custom depreciation method, or a localized extension?Has anyone successfully implemented a similar requirement, or does anyone have guidance on how best to approach this?Any help would be deeply appreciated, I’m honestly stuck on this and could really use some insight.

Thank you!!

Categories:

Dynamics 365 Finance

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