Depreciation of a house when demolishing

Discussion in 'Accounting & Tax' started by Bris Jay, 24th Jul, 2017.

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  1. Bris Jay

    Bris Jay Well-Known Member

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    I'm curious to know if I can depreciate the full value of a house that currently has tenants in it when it's demolished?

    I'll be demolishing to build a new house on the block which will also be a rental.
     
  2. D.T.

    D.T. Specialist Property Manager Business Member

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    "Currently has tenants in it when demolished"

    :eek:

    But yea, should be able to write the rest of your depreciation assuming its remaining as an investment for you.
     
  3. Bris Jay

    Bris Jay Well-Known Member

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    That's great news! I'll arrange a QS ASAP.

    I didn't bother as the house is quite old and I'll only own if for 4 months before knocking it down. With that in mind, I assume that the house will have between $50k-$100k in value that will act as a huge tax deduction next year!
     
  4. thesuperman

    thesuperman Well-Known Member

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    I'd be worried about getting thrown in jail on some murder/manslaughter charges :eek: I'd suggest demolishing the house when the tenants are out of the house :)
     
  5. Ross Forrester

    Ross Forrester Well-Known Member

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    Value of undeducted construction costs

    Yes we can! (in the words of Obama)
     
  6. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    The correct answer is the value of a potential deduction for scrapping may be substanital and if you get it wrong you will incur interest and penalties. Get personal advice. Way too many issues for a forum. I have personally seen $80K deductions and those who think they can deduct $80K get Nil.
     
  7. Bris Jay

    Bris Jay Well-Known Member

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    Would a QS be appropriate for this or are you suggesting advice from an accountant? I'd be inclined to think that any accountant would need to refer to a QS to work it out.
     
  8. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Definitely a QS report prior. But reduced by the scrap value sold etc. The QS will guide the tax adviser