Wouldn’t it be nice if you could take full advantage of your investment property – even as its value depreciates?

All properties depreciate in one form or another – but that doesn’t mean you have to take a loss. There’s such a thing as a depreciation deduction which ironically will enable you to generally claim a fairly handsome sum each year. This is done by using your property’s decline to your advantage and offsetting the loss in value against your taxable income. A depreciation schedule is a document that outlines how much you can claim annually from the depreciation of your investment property.

Why do I need one?

Having a tax depreciation schedule drawn up is highly advantageous as it allows you to really get the most out of your investment property. It turns what would generally be a loss into a gain and will help you obtain the maximum amount of tax deductions. For example, the depreciation expense for the first year on a newly built home is around 2% – 3% of the home’s purchase price.

So, if you purchased your home for $600,000, then you could receive a depreciation expense of $12,000 in the first year alone. A tax depreciation schedule also ensures that the process is compliant with ATO regulations as it is handled by industry-professionals.


What are examples of assets that could depreciate?

When a property’s depreciation value is examined it is split up into two categories – capital allowance (Division 43) and plant and equipment assets (Division 40).

  • Capital allowance – This division concerns any aspect of the actual building such as initial construction and any form of renovations/extensions – both internal (kitchen, bathroom etc.) or external (garage, decking, fence etc.).
  • Plant and equipment assets – Any appliance or piece of furniture falls under this division. A few examples would be air conditioning units, fridges, lighting appliances or security systems.

What specifically am I getting?

Simply put you’ll receive a list of the tax depreciation entitlements that are available to you. If we break it down, then we can see that what this means is that the schedule will show:

  • Each item and its value listed individually;
  • A forecast of deductions for the next 40 years;
  • A tax depreciation summary report;
  • A clear indication of Division 43 and Division 40 assets;
  • Low and high-value items that are individually tabled for clearer distinction; and
  • Both prime-cost and diminishing value methods for all tables and categories.

Reduce your tax with professionals at the helm

Accent Estimating is capable of providing premium and comprehensive tax depreciation schedules for you to benefit from. Our quantity surveyors have experience in ensuring your investment property’s cash flow is optimised and that your tax offset is maximised. Not only will you be maximising your tax return – but you’ll also be saving money further by spending less time with your accountant as they simply have to follow the schedule. What’s more, is that our full fee is 100% tax-deductible.

Depreciation Calculator