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                                          Tax Depreciation And Your
                                          Investment Property
                                          Are you a smart property investor? There are a number of           For an investment property you are able to claim depreciation
                                          ways to minimise your personal or business tax liability when      on the building itself, known as capital allowance and the
                                          you own an investment property. One way is to obtain a             fixtures and fittings of the property. The total depreciation
                                          tax depreciation schedule. A tax depreciation schedule is a        that can be claimed will vary from property to property. This
                                          document that lists all your investment’s various items, the       will depend, among other things, on the age and condition of
              Robert Cowell               amount of wear left in them (effective life) and the dollar        the property.
Preston Rowe Paterson Cairns              value you can claim against your assessable income.                     Naturally, more depreciation will be identified in new
                  4031 9552                   It does not matter the size of your property portfolio,        properties, as the full allowable 40-year depreciable lifetime               whether you are a “mum and dad investor” or a multinational        will be available.               corporation, you can benefit from obtaining an accurate                 Ideally, you should have a tax depreciation schedule
                                          depreciation schedule.                                             prepared for your investment property on settlement or within
                                              Tax depreciation is a dollar amount the Australian Taxation    the first tax year in which you own the property. The ATO will
                                          Office (ATO) will legitimately allow a taxpayer to claim on        only allow you to back claim depreciation for up to two years,
                                          items that decline in value as they age. Depreciation can be       so it is important to ensure your accountant is claiming the
                                          claimed on a variety of items from computers and cars to           maximum in legitimate depreciation on your property from
                                          residential and commercial investment properties. The Income       the outset. If you have owned the property for a number of
                                          Tax Assessment Act 1997 allows owners of both residential          years and have not yet claimed any depreciation, do not delay
                                          and commercial investment properties to claim annual               any further as you may have already missed out on claiming
                                          deductions for depreciation on:                                    benefits you are entitled to.
                                                                                                                  Unless you undertake major renovations to the property
                                          • Main buildings and structural improvements.                      in the future, you should never need to have another report
                                          • In the case of body corporate, a portion of common areas         prepared for your property. For any improvements you make
                                            and common equipment.                                            to the property, simply retain your receipts and forward these
                                          • Plant and articles such as light fittings, floor coverings,      to your accountant who should be able to incorporate these
                                            kitchen appliances and so on.                                    additions into your existing Schedule.

     Property VALUATION & CONSULTANCY Firm Covering Far North Queensland
Preston Rowe Paterson, National Property Consultants provide professional property valuation & consultancy services across the full spectrum of property and asset classes.

                                                   Preston Rowe Paterson
                                                   Cairns Pty Ltd
                                                   Call Robert Cowell AAPI

                                                   4031 9552
                                                   29-31 Spence Street, Cairns
                                                   f: 4031 9556

           Certified Practicing Valuers                                                                       

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