Promoted by Capital Claims
The Reserve Bank's May rate cut to 3.85% marked a turning point, and with further reductions forecast before year-end, borrowing conditions are improving - and so is investor sentiment.
According to Cotality (formerly CoreLogic), national home values have risen for seven consecutive months, with Sydney and Brisbane leading the charge. Auction clearance rates are climbing, and buyer activity is rebounding. For many investors, the question is no longer if they should re-enter the market, but how to do so strategically.
Cheaper finance is just the beginning
Lower interest rates are undeniably attractive. They reduce holding costs, improve serviceability, and open the door to new opportunities. But smart investors know that true profitability lies in the details - and one of the most powerful, yet often overlooked, tools in any feasibility analysis is tax depreciation.
Depreciation is a non-cash deduction that allows investors to claim the wear and tear on their income-producing property. It directly reduces taxable income, improves cash flow, and boosts after-tax returns. Yet despite its impact, many investors either underestimate its value or fail to claim it correctly.
Why depreciation matters more than ever
Whether you're purchasing a new build, renovating an older dwelling, or investing in commercial property, depreciation deductions under Division 40 (plant and equipment) and Division 43 (capital works) can dramatically improve your bottom line.
For example, a newly built residential investment property can generate $50,000 or more in depreciation deductions over the first five years. Even older properties with qualifying improvements, such as kitchen upgrades, bathroom renovations, or new flooring, can yield substantial claims.
These deductions aren't just theoretical. They're built into the structure of the property and the legislation itself. But only if you claim them correctly.
A real-world example
Consider an investor earning $150,000 annually. With a professionally prepared depreciation schedule, they could reduce their taxable income by $10,000 or more each year - resulting in thousands of dollars in tax savings. These funds can be reinvested, used to offset holding costs, or simply improve cash flow.
And the benefits aren't limited to residential investors. Commercial property owners, tenants, and developers can also claim depreciation on fit-outs, assets, and structural improvements - often with even greater returns.
The risk of DIY or AI advice
In today's digital landscape, it's tempting to rely on online calculators or AI-generated advice. But when it comes to technical tax depreciation under complex legislation, shortcuts can be dangerously misleading.
At Capital Claims, we've seen a surge in investors receiving conflicting or incorrect advice from AI tools and generic estimators. These errors can lead to inaccurate claims, missed deductions, and even ATO audits. Worse still, many DIY reports fail to account for key opportunities, such as low-value pooling, prior renovations, or eligible assets that require professional assessment.
Why investors choose Capital Claims
Capital Claims Tax Depreciation is one of Australia's leading providers of quantity surveyor-prepared depreciation schedules. We specialise in delivering ATO-compliant, tailored reports that maximise deductions and minimise risk.
Our team works with investors, accountants, and property professionals nationwide - from metro centres to regional towns - to ensure every eligible dollar is claimed. We don't just prepare reports, we help investors make informed decisions.
Here's what sets us apart:
- Certified Quantity Surveyors with deep expertise in residential, commercial, and mixed-use assets
- Comprehensive virtual or on-site inspections where required, ensuring accuracy and compliance
- Detailed analysis of prior renovations and improvements, even if undocumented
- Low-value and low-cost pooling strategies to accelerate deductions
- Ongoing support for accountants and property managers during lodgement and review
We understand that every property is unique, and so is every investor's strategy. That's why our schedules are tailored, not templated.
Timing is everything
With the October 31 deadline fast approaching, now is the time to ensure your depreciation schedules are up to date and ready for lodgement. Whether you're preparing your own return or working with an accountant, a professionally prepared schedule can make all the difference.
And remember: the cost of a Capital Claims Tax Depreciation Schedule is 100% tax deductible. For most residential properties, fees range from $440 to $715, depending on the scope of work required. It's a small investment with significant returns.
Final thought
As the market warms and opportunities emerge, don't let depreciation be an afterthought. It's one of the most effective ways to boost ROI, improve cash flow, and protect against compliance risk.
Whether you're buying, holding, or advising, Capital Claims Tax Depreciation is here to help you claim with confidence.
Ready to maximise your deductions? Visit capitalclaims.com.au or call 1300 922 220 to speak with our expert team.
Image from Canva (supplied)
