The ATO promotes two core methods to calculate depreciation on plant and equipment assets for your investment properties, (i) prime cost method (ii) diminishing value method.
In the prime cost method, the assumption is that the assets experience is also eligible to claim returns on wear and tear, and deterioration as time passes its life of utility gets influences and so a constant rate is taken here. This rate calculation is done by dividing 100% by an asset's worthy life in years.
The diminishing value method supposes that the assets wear down more in the launching years of their utility and so they facilitate high depreciation write offs in the starting phase, and decreased depreciation overtime during the asset's life span.
Computation here is done by dividing 150% by an asset's functional life in years. ATO guidelines must be resorted to discover agreed depreciation rates and the conventional working lifespan of various assets.