Insurance payment for property - declare it as income?

1. First time ever having an insurance payout. Got one for storm damage that required the roof & ceiling being replaced. Is it declarable as income? I'm guessing it is.

2. Will the roof repair and everything relating to it be depreciated over a set number of years? There were a few different type of contractors involved in the process so a few different invoices all up.

3. Depreciation - should we have gotten a "scrapping report"? I don't know if this is done for ceilings/roof repairs or just for renos done internally.

 

1. sounds like it might be a CGT event.

 

It's complicated.

We published an article on the topic earlier this year: How Natural Disasters Affect Depreciation Claims | BMT Tax Depreciation

I would definitely seek professional advice.

 

Insurance proceeds are dealt with as an assessable recoupment under specific provisions. There may be a offsetting outgoing which is depreciable, scrapped or a expense that is not capital in nature eg a repair. s20-20 ITAA97.

I would doubt that a ceiling and roof replacement due to damage is not deductible and is only depreciable. Why ? The ceiling and roof are a part of the building. The storm damage is a defect. Unless the whole building is replaced its more likley to be a deductible outgoing in the nature of a repair. You may want to discuss scrapping with your QS and provide images of the damage PRIOR to repair.