The myth of tax depreciation schedules

The ATO allows you to claim depreciation of your investment property as a tax deduction. Which means that you can claim all the wear & tear that is happening to your property & its inclusions!

Myth #1 Only brand new properties can benefit from a tax depreciation schedule

All properties have depreciation claims. A quantity surveyor who inspects the property will be able to determine exactly what that amount is & provide you with a report for a one-off, tax-deductible fee!

Myth #2 My property is older than 10 years, so there is nothing left to claim

A depreciation schedule spans 40 years. There are 3 elements of each schedule, including;

• The Building

For properties built after 15th September 1987, current tax legislation states that the built components (walls, roof, floor etc.) can be valued & the construction cost depreciated as per ATO guidelines. For apartment complexes with facilities such as a pool or a gym, these are also included in your schedule.

• Improvements

Any improvements which have been completed after 22nd February 1992 qualify to be valued & depreciated. This includes any fixed assets such as pergolas, clotheslines, fencing, paving, letterboxes, sheds, swimming pools & more.

• Plant & Equipment

Plant & equipment items, irrespective of age, depreciate. They either qualify for annual deductions or can be claimed later as a capitol loss when the property is sold. This covers removable assets such as kitchen appliances, security systems, hot water systems, floor coverings, smoke detectors, window treatments & air conditioners.

Myth #3 Your accountant is your go-to person for this & they would have told me if I needed it

Sometimes accountants are not across all facets of investment tax, as depreciation is just one small sector with BIG benefits. A certified quantity surveyor is the only one who can complete a full tax depreciation schedule. An accountant can only depreciate items that you have receipts for.