Lets start with what Tax Depreciation actually is?? It is what happens to an item over time – the item looses its value due to wear & tear. This can be from household appliances to the actual house itself. Just like you claim depreciation on your car for business purposes – you can also claim depreciation on your investment property. Unfortunately not on your owner occupied home – this tax deduction is for investment properties only.
A Depreciation Schedule is a report that breaks the property down into different categories, determining the building write-off claims and depreciation of your investment which goes as a deduction against your taxable income. Based on your allowances the report determines how much you can deduct each year as part of your tax return.
The Schedule is conducted by a Quantity Surveyor and is designed to ensure that you are getting the most possible cash return from your investment property. There are 2 elements to a Depreciation Schedule, the Capital Works Allowance (Structural & Irremovable Assets ie brickwork) and the Plant & Equipment (Removable Assets that depreciate at a faster rate than the irremovable assets ie dishwashers).
Why get a depreciation schedule on your investment? It will save you money on your tax each year. It is a one off report and will save you much more money over time than the cost of the report itself. In fact our referred agent guarantees if you don’t cover the cost of their schedule in your first return they will refund you the cost of your report. “If we can’t get you more depreciation than our fee in the first full year of your schedule … You get to keep the schedule FREE and use it in your tax assessment for the FULL 20 years with our compliments”
Depreciation allowances combined with additional negative gearing factors such as interest on a mortgage and repairs and maintenance will help investors reduce their taxable income, pay less tax and create positive cash flow.
If you would like us to organise you a no obligation quote to have a schedule done on your rental property please either give Bianca a call on 0414 205 659 or email your details to email@example.com and we will send you some more info.