The Benefits of a Tax Depreciation Report on your Residential Investment Property
Posted on October 13th, 2021
The following comments apply to most residential rental properties. There are some subtle variations, but as a guide this will normally apply.
You can more than likely claim depreciation on the construction costs of the house or any alterations and additions undertaken to the house, regardless of who did the works (you or a previous owner)
This (Capital Allowance) is your major claim in the long term. For a newish home, this will amount to many $$thousands per year.
Depending on your circumstances, some fixtures and fittings within the house or unit (referred to as plant) are depreciable. These include stoves, hot water systems, pumps, fans, airconditioners, carpet, curtains, garage door motors, swimming pool plant etc.
However, budget changes in May 2017 can often rule these items out if they are not brand new. That is why the Capital claim is your friend for most properties.
The ATO has determined that there are very few people eligible to prepare the correct depreciation schedules for rental houses or units. Quantity Surveyors are one of those eligible people and as a result, many accountants or tax agents refer their clients to a Quantity Surveyor.
The Australian Taxation Office’s Rental Properties document states “Unless they are otherwise qualified, VALUERS, real estate agents, accountants and solicitors generally have neither the relevant qualifications nor the experience to make such an estimate”
Please do not hesitate to contact Neil Richardson – Quantity Surveyor, for any queries that you may have in relation to your rental property. Neil prepares reports for properties throughout Central Queensland and has been doing so for over 25 years.
Phone 0418 184701