What is tax depreciation rate?

Depreciation rate for tax?

• why the depreciation rate for tax purpose is higher than that used for financial reporting purpose?

• Answer:

  this isn't always the case, however, a higher tax depreciation rate is used to claim as much depreciation expense early on...depreciation is tax deductible and reduces the taxable income of the entity on which tax is calculated...for accounting purposes however, you might want to show a higher profit and net asset position so therefore use a lower depreciation rate