Were you aware that the average Australian pays at least 125 different taxes each year.
Tax depreciation explained…
Over time, items within your building wear out and reduce in value.
Under legislation of the Australian Tax Office (ATO), the owners of income producing properties are permitted to claim a tax deduction for losses attributed to this wear and tear.
Depreciation is claimable under two major components: Capital works deductions (division 43) and Plant and equipment depreciation (division 40).
Capital works deductions can be claimed on the building’s structure and items considered permanently fixed to the property, while depreciation can be claimed on the plant and equipment assets contained within it such as appliances, floor coverings and blinds.
Tax depreciation allows investment property owners to pay less tax.
By increasing capital works deductions and claiming depreciation on your asset, you are able to receive a significant tax benefit and because depreciation is a non-cash deduction, you don’t need to spend money to claim it.
How does it work?
Property investors generally are required to engage a Quantity Surveyor to provide a comprehensive report or schedule that determines the deductions for Capital Works and Plant and Equipment depreciation.
This schedule is then used by your accountant each financial year when preparing your tax return.
We guarantee that if the value of the first full year’s depreciation is not at least double the value of our fee, we will give you double your money back.
Your tax depreciation schedule is also 100% deductible against your income, so our fees in preparing your report are theoretically FREE (reimbursed to you in full by the ATO with your next tax return).