diff --git a/app/Http/Controllers/SettingsController.php b/app/Http/Controllers/SettingsController.php
index 798d866983..90391a23f8 100755
--- a/app/Http/Controllers/SettingsController.php
+++ b/app/Http/Controllers/SettingsController.php
@@ -351,6 +351,8 @@ class SettingsController extends Controller
         $setting->thumbnail_max_h = $request->input('thumbnail_max_h');
         $setting->privacy_policy_link = $request->input('privacy_policy_link');
 
+        $setting->depreciation_method = $request->input('depreciation_method');
+
         if (Input::get('per_page')!='') {
             $setting->per_page = $request->input('per_page');
         } else {
diff --git a/app/Models/Depreciable.php b/app/Models/Depreciable.php
index ee12a6506a..1ed80fdcb2 100644
--- a/app/Models/Depreciable.php
+++ b/app/Models/Depreciable.php
@@ -49,7 +49,29 @@ class Depreciable extends SnipeModel
         if ($this->get_depreciation()->months <= 0) {
             return $this->purchase_cost;
         }
+        $depreciation = 0;
+        $setting = Setting::first();
+        switch($setting->depreciation_method) {
+            case 'half_1':
+            $depreciation = $this->getHalfYearDepreciatedValue(true);
+            break;
+            
+            case 'half_2':
+            $depreciation = $this->getHalfYearDepreciatedValue(false);
+            break;
 
+            default:
+            $depreciation = $this->getLinearDepreciatedValue();
+        }
+        return $depreciation;
+    }
+
+    /**
+     * @return float|int
+     */
+
+    public function getLinearDepreciatedValue()
+    {
         // fraction of value left
         $months_remaining = $this->time_until_depreciated()->m + 12*$this->time_until_depreciated()->y; //UGlY
         $current_value = round(($months_remaining/ $this->get_depreciation()->months) * $this->purchase_cost, 2);
@@ -60,6 +82,62 @@ class Depreciable extends SnipeModel
         return $current_value;
     }
 
+    /**
+     * @param onlyHalfFirstYear Boolean always applied only second half of the first year
+     * @return float|int
+     */
+    public function getHalfYearDepreciatedValue($onlyHalfFirstYear = false) 
+    {
+        // @link http://www.php.net/manual/en/class.dateinterval.php
+        $current_date = $this->getDateTime();
+        $purchase_date = date_create($this->purchase_date);
+        $currentYear = $this->get_fiscal_year( $current_date );
+        $purchaseYear = $this->get_fiscal_year( $purchase_date );
+        $yearsPast = $currentYear - $purchaseYear;
+        $deprecationYears = ceil($this->get_depreciation()->months / 12);
+        if( $onlyHalfFirstYear ) {
+            $yearsPast -= 0.5;
+        }
+        else if( !$this->is_first_half_of_year($purchase_date) ) {
+            $yearsPast -= 0.5;
+        }
+        if( !$this->is_first_half_of_year($current_date) ) {
+            $yearsPast += 0.5;
+        }
+
+        if($yearsPast >= $deprecationYears) {
+            $yearsPast = $deprecationYears;
+        }
+        else if($yearsPast < 0) {
+            $yearsPast = 0;
+        }
+        return round($yearsPast / $deprecationYears * $this->purchase_cost, 2);
+    }
+    
+    /**
+    * @param \DateTime $date
+    * @return int
+    */
+    protected function get_fiscal_year($date) {
+        $year = intval($date->format('Y'));
+        // also, maybe it'll have to set fiscal year date
+        if($date->format('nj') === '1231') {
+            return $year;
+        }
+        else {
+            return $year - 1;
+        }
+    }
+
+    /**
+    * @param \DateTime $date
+    * @return bool
+    */
+    protected function is_first_half_of_year($date) {
+        $date0m0d = intval($date->format('md'));
+        return ($date0m0d < 601) || ($date0m0d >= 1231);
+    }
+
     public function time_until_depreciated()
     {
         // @link http://www.php.net/manual/en/class.datetime.php
@@ -81,4 +159,10 @@ class Depreciable extends SnipeModel
         date_add($date, date_interval_create_from_date_string($this->get_depreciation()->months . ' months'));
         return $date; //date_format($date, 'Y-m-d'); //don't bake-in format, for internationalization
     }
+
+    // it's necessary for unit tests
+    protected function getDateTime($time = null) 
+    {
+        return new \DateTime($time);
+    }
 }
diff --git a/database/migrations/2018_08_20_204842_add_depreciation_option_to_settings.php b/database/migrations/2018_08_20_204842_add_depreciation_option_to_settings.php
new file mode 100644
index 0000000000..7678c45d56
--- /dev/null
+++ b/database/migrations/2018_08_20_204842_add_depreciation_option_to_settings.php
@@ -0,0 +1,32 @@
+<?php
+
+use Illuminate\Support\Facades\Schema;
+use Illuminate\Database\Schema\Blueprint;
+use Illuminate\Database\Migrations\Migration;
+
+class AddDepreciationOptionToSettings extends Migration
+{
+    /**
+     * Run the migrations.
+     *
+     * @return void
+     */
+    public function up()
+    {
+        Schema::table('settings', function (Blueprint $table) {
+            $table->char('depreciation_method', 10)->nullable()->default('default');
+        });
+    }
+
+    /**
+     * Reverse the migrations.
+     *
+     * @return void
+     */
+    public function down()
+    {
+        Schema::table('settings', function (Blueprint $table) {
+            $table->dropColumn('depreciation_method');
+        });
+    }
+}
diff --git a/resources/views/settings/general.blade.php b/resources/views/settings/general.blade.php
index 41fe09ea59..af93a7c8ec 100644
--- a/resources/views/settings/general.blade.php
+++ b/resources/views/settings/general.blade.php
@@ -281,6 +281,20 @@
                                {{ Form::checkbox('show_in_model_list[]', 'model_number', Input::old('show_in_model_list', $snipeSettings->modellistCheckedValue('model_number')),array('class' => 'minimal')) }} {{ trans('general.model_no') }}<br>
                            </div>
                        </div>
+                       
+                       <!-- Depreciation method -->
+                       <div class="form-group {{ $errors->has('depreciation_method') ? 'error' : '' }}">
+                           <div class="col-md-3">
+                                {{ Form::label('depreciation_method', trans('Depreciation method')) }}
+                           </div>
+                           <div class="col-md-9">
+                               {{ Form::select('depreciation_method', array(
+                                    'default' => 'Linear (default)', 
+                                    'half_1' => 'Half-year convention, always applied', 
+                                    'half_2' => 'Half-year convention, applied with condition', 
+                                ), Input::old('username_format', $setting->depreciation_method)) }}
+                           </div>
+                       </div>
                        <!-- /.form-group -->
 
                        <!-- Privacy Policy Footer-->