When calculating Salvadoran taxable income, assets owned by an enterprise are normally depreciated over their normal useful using the straight-line method. Assets with a useful life of a year or less can be fully written off in the year of acquisition.
The applicable rates for various assets types are as follows
|Other movable property||50%|
Used Machinery and Movable Property
When depreciating used machinery and other movable property, only a portion of the cost of the asset is depreciable for tax deductions purposes. The tax deductible portion is based on the useful life of the asset at the following percentages:
|1 year but less than 2||80%|
|2 years but less than 3||60%|
|3 years but less than 4||40%|
|4 or more years||20%|
Aside from software, intangibles assets such as goodwill, trademarks, copyrights, etc. may not be amortized for tax purposes.
For new software, the maximum amortization rate is 25% of the acquisition or development cost. Note, that the depreciable portion rules for used machinery also applies to used software.