What is the best way to implement soft deletion?

Having is_deleted column is a reasonably good approach. If it is in Oracle, to further increase performance I'd recommend partitioning the table by creating a list partition on is_deleted column. Then deleted and non-deleted rows will physically be in different partitions, though for you it'll be transparent.

As a result, if you type a query like

SELECT * FROM table_name WHERE is_deleted = 1

then Oracle will perform the 'partition pruning' and only look into the appropriate partition. Internally a partition is a different table, but it is transparent for you as a user: you'll be able to select across the entire table no matter if it is partitioned or not. But Oracle will be able to query ONLY the partition it needs. For example, let's assume you have 1000 rows with is_deleted = 0 and 100000 rows with is_deleted = 1, and you partition the table on is_deleted. Now if you include condition

WHERE ... AND IS_DELETED=0

then Oracle will ONLY scan the partition with 1000 rows. If the table weren't partitioned, it would have to scan 101000 rows (both partitions).

You could perform all of your queries against a view that contains the WHERE IS_DELETED='0' clause.

I would lean towards a deleted_at column that contains the datetime of when the deletion took place. Then you get a little bit of free metadata about the deletion. For your SELECT just get rows WHERE deleted_at IS NULL