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Alternative to depreciation schedule?

Discussion in 'Accounting & Tax' started by Thread, 30th Mar, 2016.

  1. Thread

    Thread Member

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    I'm just about to start renting out what is currently my PPOR (1967 built house) in NSW.

    I understand having a depreciation schedule should give me a big tax benefit - but I'm not clear on the downsides of having this schedule done? If I choose to go this route, does it mean I'm not able to write off future repair/ maintenance costs that I could do otherwise?

    Are there any negatives to having this schedule done?
     
  2. Xenia

    Xenia Adelaide Property Manager Business Member

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    apart from paying for a report where there are no benefits claimable, ie old house, I can't see any negatives to a depreciation schedule.
     
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  3. datto

    datto Well-Known Member

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    You'll still be able to claim future repairs and write offs..that's what this game is all about. As long as you rent the place out of course.
     
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  4. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    A QS will be the best adviser.
     
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  5. D.T.

    D.T. Adelaide Property Manager Business Member

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    No downsides, Thread. Repair and maintenance write offs in the future don't change.

    You get a nice discount on the schedule for pre 1985 houses too (my clients get a discount with Depreciator too) because there's less to find, but there's still enough to make it worthwhile.
     
  6. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    No, not at all. Those claims are entirely different to depreciation claims.

    No reputable provider would allow a client to go through with the schedule if this were to be the case.
     
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  7. bread_boy

    bread_boy Well-Known Member

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    Is it worth getting a surveyor out to site for a house built pre 1985?
    e.g. ex-housing commission house in original condition built in 1980.
    I understand the QS would prefer to do a photo/no inspection report as the margins are higher but is there any real advantage to getting a someone to attend site for such an old building?
     
  8. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    Yes, but other factors are at play. When did you buy it?

    That must depend on the provider. We would never provide a schedule for an older property without having inspected it.

    You would be surprised at the value that might be hidden there. Talk to a QS, give them the address and they'll give you a preliminary estimate before you proceed.

    You will get what you pay for. Doing a DIY/no inspection job on an older property is going to result in missed and undervalued items.
     
  9. bread_boy

    bread_boy Well-Known Member

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    Just settled last month.
     
  10. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    Then yes, absolutely. Whichever way you go about it, don't put depreciation in the too-hard basket. That old house may have a first-year claim of between $2000 and $6000, depending on its size, fit-out and level of renovation. If you private message me the address I could tell you what sort of ballpark you can expect.