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Depreciation Schedule

Discussion in 'Accounting & Tax' started by miscg, 29th Oct, 2015.

  1. miscg

    miscg Member

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    I am in the process of purchasing a brick home approx. 20 years old. Is It worth getting a depreciation schedule done?
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Yes
     
  3. HomePage

    HomePage Well-Known Member

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    You'd have to be fully lucky to get away with not having a proper one done if you are going to claim depreciation on tax.
     
  4. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Yes - I'm still claiming depreciation against a 50 year old fibro home in rural nsw :)
     
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  5. Depreciator

    Depreciator Moderator Staff Member

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    20 years old makes it a mid 90s build. Definitely worth doing.
     
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  6. norwoodman

    norwoodman Well-Known Member

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    Absolutely worth getting one regardless of how old the property is as there would have been improvements and things replaced over the life of the building. In the extremely unlikely event that the total deductions come to less than the QS fee, most will waive their fee and it is claimable as a deduction.
     
  7. Jacque

    Jacque Buyers Agent and Bookworm, Sydney Business Member

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    Yes absolutely and try Scott (Depreciator in post above) or Washington Brown for best reports.
     
  8. inertia

    inertia Well-Known Member

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    Oh man.

    I am getting more and more disappointed with my accountant.

    Cheers,
    Inertia.
     
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  9. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    A related party to me acquired a property build around 1996 recently. Scott did the depreciation schedule and there is about $12k of depreciation to claim in the first year alone.
     
  10. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    To expand, a post-1987 build has a 40-year lifespan, so this still has half its life to go, plus you get to claim all of the fixtures and fittings, which restart their lifespan upon your settlement date.
     
  11. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    In case you missed it, @miscg, YES :)

    Might be surprised at how much you are able to claim too. @Depreciator's team have been marvellous on my apartments, and house.


    @inertia, why do you say that? Been advised not to bother with a report on a similar property?
     
  12. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Until a QS tells you not to bother...You bother.
     
  13. Blacky

    Blacky Well-Known Member

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    someone mentioned a depreciation report :oops::oops::oops:

    FULLY LUCKY

    :p

    sorry - my torets kicking in... Couldnt help myself. :D
     
  14. Northy85

    Northy85 Well-Known Member

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    You're throwing away money if you don't
     
  15. newbie property

    newbie property Active Member

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    what about an old unit built in 1979, is it worth to get depreciation report or don't bother?
    Thanks!
     
  16. Heinz57

    Heinz57 Well-Known Member

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    Yes
     
  17. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    When did you buy it? Age is only one factor.

    If you want to provide me with the address, when you bought it, any renovations you've performed (or know of by previous owners) and whether you've lived there and for how long, I could provide an estimate.
     
  18. Northy85

    Northy85 Well-Known Member

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    It's one of the best parts about having properties. Receiving fat tax returns for things you didn't actually spend money on throughout the year. Tax time is better than Christmas.
     
  19. newbie property

    newbie property Active Member

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    Hi Chris,

    Thanks for the reply!

    I'm in the process of buying it, probably settling early next year. The address is in Granville, NSW.
    I won't be living there, will have to rent it out I guess, I'm not planning to do any renovation as the owner was living there, so it was well maintained, probably just cleaning by myself. I know the owner did renovation in 2009 when they bought, painting and timber floor..not sure if I can claim that? but there is no receipts from them...

    I heard that building after 1985 has to get a QS to do depreciation, I'm suppose buildings before 1985 can be estimated by an accountant? is it correct?

    Thank you for your time!
    Appreciate it!
     
  20. BMT Tax Depreciation

    BMT Tax Depreciation Chris Business Member

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    Thanks, Newbie. If you'd like to send me a link to its listing I should be able to get that estimate to you. Unfortunately I can't do it on the suburb alone because there are still too many variables involved.

    That's precisely where we come in. When no costs are available we are qualified to make an estimation in accordance with ATO rulings, and our job is to make those estimates as high as reasonably possible. Not only will you be able to claim on those renovations but all Division 40 fixtures and fittings in the property.

    That's an interesting take on things! No, if you heard that then I'm afraid that's quite incorrect and you've been fed faulty advice.

    1985 is no longer a relevant year for residential property depreciation (even though some providers still have it on their website! Not a good sign). It is now 1987 that is the cut-off year for claiming original capital works.

    An accountant is not qualified to estimate any capital works, regardless of age. The only way they can depreciate capital works is by having the actual raw costs available to them, which is not possible in most cases, and is even less probable for older properties than for new ones. An accountant also could not estimate a building constructed before 1987 because the building would not have any available depreciation on it anyway (only its fixtures and fittings, and renovations as discussed already).

    Does that clarify things?