any depreciation for a commercial car space?

Discussion in 'Accounting & Tax' started by chopchop, 22nd Jun, 2019.

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  1. chopchop

    chopchop Member

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    Hi all.
    Is it worth to get a depreciation schedule for a commercial car space near the airport?
    I just recently bought one.
    Will the depreciation be more than the cost of getting the depreciation schedule?
    It's just a car space, I would guess it doesn't depreciate much at all as there is no improvement, no pipes, no renovations required.

    Thanks for any advice
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    What does it consist of - newly constructed slab, line marking, lighting, bumper rails, wheel stop, parking space indicator? Who is responsible for the maintenance? Is it separately assessed for strata levies, rates, parking levy etc?
     
  3. Ross Forrester

    Ross Forrester Well-Known Member

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    I can’t see much capital works for an open air car park. If it is part of a multi story it could be worthwhile as you still have a building.
     
  4. chopchop

    chopchop Member

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    The property I bought is only about 2.5x10m space, indoor on the second floor of maybe 8 floors building, with line markings just like in any shopping centres, offices and apartments.
    no bumper rails or wheel stop etc.
    Managed, maintained and run by park n fly, parking near Sydney airport
    The outgoings are just strata levy and rates.
     
  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Any improvements? Painted a stripe?
     
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  6. chopchop

    chopchop Member

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    yes, but I don't know when was the last time they painted the boundary lines and the space number
     
  7. Momentum

    Momentum Well-Known Member

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    You could install a kitchenette with double power point and microwave on the back wall. Put some carpet down in the remaining space and use it for motorcycle parking. This will maximize your depreciation.
     
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  8. chopchop

    chopchop Member

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    thanks, then i'll get a quote for depreciation.
     
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  9. chopchop

    chopchop Member

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    haha, that would be funny.
     
  10. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    The Park 'n' Fly, you say? Mascot, you say? Would that be the one at 1008 Botany Road?

    Something people often forget is that strata units (which this is) are entitled to a claim over common area, which in this case includes the doors, gates, security and fire equipment, bins, fans, pumps, lights, etc. This claim is relatively small but usually justifies the expense of a schedule (the latter of course won't be the same cost as for a fully fledged property).

    To give you an example, I picked a report we've done here at random and found that the first pro rata claim was slightly over $800 and the ongoing claim was a shade under $400 in building allowance annually. The second one I looked at did even better, both with the first pro rata claim and the annual building allowance.

    I.e., in the long term I think it's a good idea for most people.
     
    Last edited: 24th Jun, 2019
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  11. chopchop

    chopchop Member

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    Hi Chris, Yes that's right.
    Would you be able to quote for me how much is a depreciation schedule for it?
    Do you have enough time to prepare for this FY? It's probably identical to one of the ones you have done for other lots in that Park n Fly building
    And whether I should do it now or next FY? There is only 23 days of depreciation for this FY.
    Thanks.
     
  12. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    As long as you get the invoice to do it this FY you should be good. Then get the report done anytime before you lodge FY19 and you claim the cost of the report plus the depreciation.
     
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  13. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    In order:

    * Sure, I'll send you a private message.
    * Probably not, but that doesn't matter. The only requirement is that it's done before you file your tax return. If we receive payment before EOFY, the fee is a claim for this year (sorry, it's not the invoice date as Westminster suggests).
    * It might look identical but the reports I've looked at have differing claims due to the unit entitlement in the strata plan. This can be affected by things such as which floor it's on and where it's situated. It's not just a matter of changing the lot number on an existing report.
    * Because you'll have a small share of common area assets, your 23 days in 2019 could still see you with a deduction big enough to pay for the report because of immediate write-off rules (i.e., your share in many assets is likely to be $300 or less). So, yes, I'd recommend doing it before this year's tax return.
     
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