In this month’s QS Corner...when everything old is new again!
I often get asked “Can I claim depreciation on my very old property?”
The simple answer is yes, but this is where a lot of investors make a mistake...
There are two components to a depreciation schedule Quantity Surveyors prepare on your investment property.
The first component involves claiming what’s called the “Building Allowance”.
The Building Allowance relates to the structure of the building and includes things like brickwork, concrete, windows and even the kitchen sink!
Unfortunately, this part of the claim is date dependent.
If construction of your residential property began after the 16th of September 1987 – yes you can claim the Building Allowance. If construction started prior to this date – I’m sorry – you miss out on the claim.
However, ALL properties are eligible to have the Plant and Equipment component of the building depreciated.
Claiming depreciation on Plant and Equipment relates to the wear and tear of items within your investment property, like carpet, ovens, dishwasher etc.
These items actually wear out more quickly and therefore can be claimed at a higher rate, over a quicker amount of time.
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.