SA Adelaide Property Network - May 31 Tax and Depreciation

Discussion in 'Networking & Meetups' started by Xenia, 10th May, 2016.

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  1. Xenia

    Xenia Well-Known Member

    21st Jun, 2015
    Tax and Depreciation

    End of Financial Year is almost here... June 30 is knocking on the door...

    So what does this mean for my investment property?

    How can I save money?

    1. Has my property been assessed for depreciation?

    2. If so, is my depreciation schedule up to date?

    3. Is now the time to spend some money on my investment?

    These are just some of the questions you should be asking yourself right now.

    The answer to the first question is easy...Depreciation schedules yield an average depreciation claim after the first 12 months is $5,546 on all property types.

    Better still the fee to complete the service can be claimed back in this financial year's return. Why wait!

    Your second question is quite simple to answer too... If your property has changed over the last 12 months, if you have made improvements, then you should update your depreciation schedule.

    And your last question... Is now the time to spend money on my investment? Well, let's look at what spending money on your property investment prior to 30th June means?

    Take your hot water service as an example. It has been depreciating for 2 years - we suggest the value could be $2,400. The ATO suggests this should last you 12 years, which allows a depreciation claim of $200 in value each year.


    Notice the remaining value of the hot water service is scrapped when it gets replaced. It becomes an immediate deduction and the new hot water service starts depreciating all over again!

    Other items in your investment that have been assessed and attract depreciation behave the same. So spending money and upgrading your property now could keep your investment performing better and help reduce your taxable income.

    To Learn more about Depreciation schedules and maximising the potential of your investment property, we have Robert Toole, a quantity surveyor from Real Property Matters as one of our guest speakers at the May 31st Adelaide Property network.

    George Zajkov, a property accountant will also be presenting on tax related matters for property investors.
    Tax and Depreciation - a double presentation.

    Come and join us

    The Robin Hood Hotel 315 Portrush Rd Norwood

    May 31st at 6:30pm

    Looking forward to seeing you there.

    MTR and househuntn like this.
  2. Xenia

    Xenia Well-Known Member

    21st Jun, 2015
  3. John Kalantzis

    John Kalantzis New Member

    2nd Dec, 2015
    L3/ 169 Fullarton Road, Dulwich SA 5065
    Yes I'll be there Xenia
  4. Xenia

    Xenia Well-Known Member

    21st Jun, 2015
    Looking forward to seeing you John
  5. Xenia

    Xenia Well-Known Member

    21st Jun, 2015
    Good afternoon property investors

    This Tuesday May 31, we will be discussing Tax and Depreciation.

    Our guest speakers will be George Zajkov from ADS accountants (a property tax agent) and Robert Toole from Real Property Matters (a registered quantity surveyor).

    The meeting will be at the Robin Hood Hotel, 315 Portrush Rd Norwood at 6:30 pm.

    Join us for dinner and drinks after the presentations at the Robin Hood

    Below are some general tax tips for property investors.

    It’s that time of the year again, the end of the 2015 – 2016 financial year and our upcoming Property Network meetup on tax and depreciation will provide you with that extra tip or two to help maximise your property investment income through allowable deductions.

    Here are some things to consider:

    Improvements and Renovations.

    A newly renovated property can add significant tax deductions for depreciation and also maximise your cash return. If your property has been improved through renovations within the last 12 months you may be eligible for a deduction for depreciation on the cost of those improvements, provided these items are identifiable and itemised in a depreciation schedule done by a registered quantity surveyor.

    If your investment property is a recent purchase and renovations or improvements have been carried out by a past owner, you may still be eligible to claim a deduction on their cost if they are listed within a schedule.

    If you are planning a new renovation within the next financial year, a quantity surveyor can prepare a scrapping schedule. This puts a value against all items that will be replaced during the renovation, kitchen cupboards, carpets and flooring, bath, showers etc, and this value can be claimed as an expense once the renovation is completed. A new depreciation schedule can be prepared to outline the deductions available on the new items.

    The cost of a depreciation schedule is also tax deductible.

    Claiming Repairs and Maintenance

    Repairs and maintenance on rental properties can be tax deductible provided the maintenance or wear and tear on a property have occurred as a result of earning a rental income from that property.

    An accountant good property accountant can group those repairs and maintenance into immediate tax deductions or capital works, what can be claimed against future capital gains on that investment property.

    Keeping Good Records

    Keeping all receipts to prove deductions and show why the expense was incurred is very important to derive the assessable income for an investment property.

    Good property management plays a key role in record keeping and specialist property management agencies sometimes offer a complimentary book keeping service for your investment properties. As well as collecting the income for the rental property, property management companies can pay all invoices and bills for each property like council rates, water rates, insurance and repairs and maintenance invoices and provide a monthly statement showing all income and expenses for that month. This includes the cost to manage the property which is also tax deductible.

    An annual statement is also provided by property management companies showing a summary of income and expenses incurred for the last financial year.

    Other Deductions to consider

    Before contacting your property tax agent, ensure you also have bank statements showing interest expense on borrowed funds against the purchase of the property. Interest on the loan related to that rental property (not what it is secured against) is another deduction that can be claimed to maximise the cash flow for your investment property.

    To learn more from our tax agent and quantity surveyor, please attend our complimentary meet up

    Adelaide Property Network

    When – Tuesday May 31

    Time: 6:30 pm

    Where: The Robin Hood Hotel, 315 Portrush Rd Norwood.

    Topic: Tax and Depreciation

    Provided – Complimentary light meals, drinks and networking

    Adelaide Property Casual dinner and discussion – at the Robin Hood after the meeting, no need to pre-book, just stay on after the presentations.

    See you there.
    MTR likes this.