Calculating your value after depreciation is straightforward once you know the Car Depreciation formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Car Depreciation Calculator.
What is Car Depreciation?
The Car Depreciation calculation tells you your value after depreciation from a few simple inputs. The figure you are solving for here is the value after depreciation, expressed in INR.
The Car Depreciation formula
The core formula is:
Value after depreciation = Purchase price × (1 - Annual depreciation rate ÷ 100)^(Years owned)Here is what each input means:
- Purchase price — a money amount. Example: ₹10,00,000.
- Annual depreciation rate — a percentage, such as an annual rate. Example: 15%.
- Years owned — a number. Example: 5.
How to calculate it step by step
- Write down the purchase price (for example, ₹10,00,000).
- Write down the annual depreciation rate (for example, 15%).
- Write down the years owned (for example, 5).
- Apply the formula above to get your value after depreciation.
- Double-check the result with the Car Depreciation Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Purchase price | ₹10,00,000 |
| Annual depreciation rate | 15% |
| Years owned | 5 |
| Value after depreciation | ₹4,43,705 |
| Total depreciation | ₹5,56,295 |
With purchase price of ₹10,00,000, annual depreciation rate of 15% and years owned of 5, the value after depreciation works out to ₹4,43,705.
Example 2
With purchase price of ₹20,00,000, annual depreciation rate of 15% and years owned of 5, the value after depreciation works out to ₹8,87,411.
| Result | Value |
|---|---|
| Value after depreciation | ₹8,87,411 |
| Total depreciation | ₹11,12,589 |
Example 3
With purchase price of ₹5,00,000, annual depreciation rate of 15% and years owned of 5, the value after depreciation works out to ₹2,21,853.
| Result | Value |
|---|---|
| Value after depreciation | ₹2,21,853 |
| Total depreciation | ₹2,78,147 |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
Prefer not to do the maths by hand? — the Car Depreciation Calculator does it instantly, for free, with the formula and a worked example built in.
Related calculators
Continue exploring automotive calculators with these tools: Engine Displacement Calculator, Compression Ratio Calculator, Horsepower to Torque Calculator, Gear Ratio Calculator, Tire Size Calculator.