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How useful are tax depreciation reports?

Written by: Georgina Emanuel

Are you a commercial property investor?

Are you maximising the returns available from your investment?

Each year, millions of dollars in property depreciation goes unclaimed by investors. This stems from many investors not knowing how and what they can claim.  The decline in value of a depreciating asset is generally based on the effective life of the asset (the number of years a depreciating asset can be effectively used to produce income) and the depreciation method chosen.

What can you claim?

You can claim deductions on your property investment based on the following allowances:

Depreciation assets

These are items that lose value more quickly such as: carpet, lifts and whitegoods. Additionally, you may be able to claim up to 20% off the property’s purchase price this way.

Building allowances

You can claim a deduction for the construction costs of buildings and other capital works – such as structural improvements – that are used for producing income. Depending on when your property was built, you may also be able to claim a deduction for part of the original construction or refurbishment costs. Different deduction rates apply (2.5% or 4.0%) depending on the date on which construction began, the type of capital works, and how it's used.

A professionally prepared depreciation schedule, could result in thousands of dollars more for your pocket – a great way to unlock cash and grow your property portfolio faster!

Napier & Blakeley can help you with this by preparing full tax depreciation schedules for your property. This provides you with the opportunity to reduce your assessable income and increase the cash flow during ownership by improving the yield. On top of all this, the fees are usually 100% tax deductible.

To find out more on how Burgess Rawson can enhance your property’s return and save you money, feel free to contact us today.

Sources: Napier & Blakeley, ATO

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