To repair or not to repair?

By Tyron Hyde | 24 Apr 2015

Expert Advice with Tyron Hyde

 When you renovate a property, the builder will generally supply a Tax Invoice that outlines the amount owed and an overview of the work carried out.

If part of the work carried out is deemed to be a repair in nature, you can claim the total cost of the repair as an outright deduction.

BUT, if the work carried out is deemed to be a capital improvement - you must claim the cost of the work over 40 years at a fixed rate of 2.5% per annum.
Unfortunately, the determination of these works is not always straight forward.

The correct classification of the renovation can make a big difference to the bottom line for a property investor.

Generally, a builder is not thinking “How can I itemise this Tax Invoice in order to maximise my clients’ tax return?”.

That’s where Quantity Surveyors can help!

Quantity Surveyors, in my opinion, are well placed to assist in the determination of capital works items versus repairs, potentially saving property investors thousands.


Tyron Hyde is the CEO of Washington Brown and is considered one of Australia’s leading experts in property tax depreciation. He is also a registered tax agent.  Washington Brown manages construction costs worth over $2 billion and completes 10,000 schedules annually. For a depreciation schedule quote CLICK HERE and follow the 3 simple steps or estimate your depreciation cost. 

The Washington Brown Free Depreciation Calculator will give you an estimate of the depreciation deductions you could claim on your investment property

Read more Expert Advice articles by Tyron
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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