Property Tax Depreciation

Property components decline in value as most business assets. If the said property generates investment income, the Australian Taxation Office (ATO) allows the property owner to claim back this decline in value via a Tax Deduction. 

Various components of the building decline at differing rates. The date of the build and the date that the asset became income generating both influence the extent of the eligible deduction. Your marginal tax rate is also a key factor.

A registered Quantity Surveyor who is also a registered Tax Practitioner are the only persons recognised by the ATO to prepare a depreciation schedule of these values. These are presented to your accountant to be used in the claiming of these deductions in your tax return. These schedules cannot be prepared by your accountant.

Where original building cost information is not available, the Quantity Surveyor will be required to prepare an estimate of the construction cost of the building.

QCS can provide you with a report that meets the ATO requirements. We are a full service QS practice and have active projects across several sectors. 

Where the property is part of a cluster, certain areas of ‘common property’ may be proportionally claimed by the individual owner as part of their depreciation claim.

Your accountant is the best person to advise you on the potential range of the deduction benefit, but it will usually far outweigh the cost of the preparation of the schedule. The cost of the schedule is also a valid Tax Deduction.

Once prepared, the schedule will only need to be updated when any alterations or improvements are carried out to the property that are depreciable.

A tax depreciation schedule is known to help turn sometimes negative or close to negative cash flows into positive cash flows 

QCS can provide a report from as little as $495 plus GST. Please contact us for a quote. This fee will be tax deductible.