Depreciation Tax Tips

Following the Federal Budget Announcement on Tuesday May 9th 2017, the Government has made significant changes to the way investors can now claim tax depreciation deductions. One of the key points of the new legislation is that Investors who purchase a second-hand property after May 9th, 2017 will no-longer be entitled to claim depreciation on any “previously used” Plant & Equipment assets. These items include blinds, carpet, ovens, air-conditioners etc.
This is leading many people to believe that there is no benefit in proceeding with a depreciation report if they purchased an older property after the 2017 announcement. NOT TRUE!
With the end of Financial Year fast-approaching, we want to remind investors who have recently purchased a second-hand property that if they do not have a Depreciation Schedule prepared, they could be missing out on THOUSANDS of dollars in tax deductions.
Consider the following example from a recent clients of ours.
Rachel purchased a 4 bedroom, 2.5 bathroom house in North Brisbane Jan 2018. She paid $550K and the property was built in 2004. It was clear that a previous owner had renovated the kitchen and the bathrooms. Whilst there was no depreciation deduction available for the existing “previously-used” Plant and Equipment items, Rachael was able to claim on the Capital Works component of the original structure and of these previous renovations.
Washington Brown – The Depreciation Experts were able to achieve ATO-compliant tax deductions in excess of $80,000 over the next 20 years!
Remember: The cost of a report is fully tax deductible and is a one-off expense. Washington Brown happily offer a discounted fee to clients of The Edge Property Buyers. To find out if you are eligible to claim depreciation and to receive a free quote, click on the link below:
Free Depreciation Quote Request – The Edge Property Buyers