# CGT on Investment property sale

Discussion in 'Accounting & Tax' started by redsquash2, 19th Oct, 2019.

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1. ### redsquash2Active Member

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How does depreciation factor into a newinvestment property I bought after 2010 and then sell 10 years later, when calculatng CGT.
i have the depreciation schedule btw

Bought for \$300,000 sell for \$600,000
Profit of \$300,000

CGT calculation \$300,000x .5 = \$150,000 added to my income
Whats wrong with my calcualtion? (ignore purchasing costs just to keep it simple for the time being)

I will pluck out a total figure of \$20,000 for depreciation
An explanation using the curent example would be very useful
thanks

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If by 'depreciation' you mean capital works:
Cost base would be \$300,000 less \$20,000 = \$280,000

Capital gains = \$600,000 - \$280,000 = \$320,000
apply 50% CGT discount = \$160,000

\$160,000 is the income to the taxpayer, assuming an individual.

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3. ### redsquash2Active Member

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Great .All understood.

Solicitors fees/advice, conveyancing costs, and Buyers agent fees can be addedd to the Cost base.Is that correct??

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Generally, but it depends

5. ### willy1111Well-Known Member

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Depreciation is normally broken down into 2 parts...capital works and plant and equipment.

Is depreciation of plant and equipment taken into account for CGT calcs?

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7. ### [email protected]Tax, Accounting + SMSF + All things Property TaxBusiness Plus Member

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A range of issues can impact CGT and lead to erors that increase tax or underpay tax.

eg : Is the cost of the assets that were depreciated included in the costbase ?? eg The oven you bought 2 years ago needs to be added to the historical costbase.

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