Renovating & Improving IP that will be used as PPoR ?

Hi all fellow investor,

I have current apartment that is rented out as my investment property.

In the next month or two, I will have it renovated (cosmetically not structurally) add some Airconditioning, appliances and then I'll be moving in as my place to live (PPoR).

So, later on in the next 5-6 years if I rent this apartment again as my investment property, what can be claimed as tax deductible or depreciable ?

Do I need to keep the receipt for all the renovations and appliances until I sell this apartment ?

Thanks in advance.

 

Depreciation start when the asset is aquired so there may be not much left to claim when u move in

 

@Terry_w thanks for the clarification, so what about if I rent it out again in the future ?

Does any renovation that I do next month can still be counted for tax deduction when I rent it out in the future or when I sell the property ?

 

Depends on the life of the asset - if it is 5 years and you rent it out 6 years later there will be nothing to claim.

 

Some costs to make good tenant wear and tear (eg painting and cosmetic repairs) may be deductible after the tenancy and before you move in if it is a repair PROVIDED the repairs are made and paid after the tenancy ends but BEFORE THE FOLLOWING 30 JUNE. This is a strict ATO rule and a owner who say evicts a tenant on 28th June and does repairs on 1st July cannot claim the deductions. Timing is gold for this special rule.

Tip #2 is to defer the QS report until you do get to the future rental period. This may preserve limited values for QS deductions at that time. QS reports tend to write down aggressively and delaying actually starting that process leaves some limited options to the QS to preserve some deductions. Nobody says a asset MUST be depreciated over 5 years....You could delay the write off until 5 years and its value at that time could be the start point.