Could someone inform me what the general depreciate-able life of the different commercial sector real estate would be? Specifically such as retail, office, industrial, hotels etc, or would they all even be the same?... I know resi is 40 years. Also any supporting links or sources would be appreciated. Thanks
Building depreciation allowance is 2.5% for all buildings however there may be particular circumstances that this may be shorter eg: temporary structures (write-off is brought forward). Even though the building depreciation runs over 40 years, this does not relate to whether a 40 year old building is still suitable for the purpose ie: functional obsolescence (column spacing, ceiling height, building services etc)
Hello, Their is a rate of 4% for commercial buildings where they are used mainly for: (a) industrial activities; (b) used mainly to operate a hotel, motel or guesthouse where the buildings have at least 10 bedrooms that are for use wholly to provide short-term traveller accommodation (ie hotel buildings), or (c) consisting of at least 10 apartments, units or flats that are for use wholly to provide short-term traveller accommodation, ie apartment buildings. The 4% rate is still available if the buildings also have facilities that are mainly for use in association with providing short-term traveller accommodation. You should refer to s 45-145 of the 1997 Tax Act. Also refer to section 45-150 for a definition of "industrial activities". If this is your building for your business try to have the business and the building separated to assist in asset protection and future succession issues. Thanks.
