Expert Advice: by Tyron Hyde
Can you claim depreciation on an older renovated property?
Yes, it doesn’t matter who paid for those renovations – as long as the work took place post 1985, you (as the new owner) are entitled to depreciate it.
And the good news is even minor renovations can yield a significant amount of depreciation.
I recently inspected a unit that was renovated in the mid-nineties.
I estimated that the previous owner spent about $55,000 putting in a new kitchen, bathroom, new blinds and carpet.
The current owner would be looking at about $8000 - $10000 worth of tax deductions in the first year alone.
That’s because items like carpet and blinds have a relatively low effective life – which means you can claim them quicker.
Trouble is – in most cases the new owner won’t have access to the renovation costs. But – that’s where we come in.
Washington brown has a team of trained quantity surveyors who can inspect the property and estimate the price of the renovations.
We then create a depreciation schedule we can send straight to your accountant.
Tyron Hyde is a director of quantity surveying firm Washington Brown. For more QS Corner tips and information on property depreciation including a FREE online tax depreciation calculator, visit www.washingtonbrown.com.au
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Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.
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