Depreciation on PPOR turn IP

Hi gurus

I'm interested to know with the new tax rules surrounding depreciation what is and isn't claimable when turning a PPOR into an IP.

Details are I built a brand new home end 2014, occupied start of 2015. Have lived there until now when I am relocating interstate for work. Leasing out our property (advertised Aug 2018) and will organise a depreciation schedule soon. Will I be able to claim plant and equipment as well as capital works or only the latter as the purpose has changed? Wondering if the fact the original costs were mine makes any difference?

Any 'advice' is greatly appreciated.

 

Only the Cap Works. The depreciation on the Plant and Equipment gets deferred because it is now not brand new - when you sell the property that deferred depreciation can reduce your CGT.

 

I havent considered this until now...If a taxpayer used the 6 year absence rule is the deferred CGT issue ignored or also claimed

I'm being lazy.

 

Good question Paul. I'm certainly planning on utilising the 6 year rule in future. Well that's the plan anyways.. Have got a valuation at time of switching from PPOR to IP anyway just in case..

 

Scott above is correct about your ineligibility to claim the plant and equipment (unless you install new items after vacating). Many get disheartened by this but it's important to remember that the capital works allowance on any property of this age is substantial and will be in the multiple thousands of dollars yearly.

 

Thanks Gents. Certainly still understand the value in a depreciation report for a property of this age even if it is only capital works claimable. I'm certainly not upset as the property has served its purpose in terms of a quality home as a PPOR for a few years. Life, situation and goals change. The tax concessions now from moving it to an IP are merely an added bonus.